FedEx Earnings: $2.7 Billion in Tariff Refunds Held for Customers, Profit Forecast Raised

By Stock Titan Editorial Team Published October 28, 2026, 04:53 PM EDT · Updated October 28, 2026, 05:04 PM EDT

FedEx earnings and the tariff refunds it holds for customers

The story starts at the Supreme Court. The White House had used an emergency powers law, the International Emergency Economic Powers Act (IEEPA), for its drug trafficking tariffs and its reciprocal tariffs. The reciprocal tariffs were a charge of at least 10% on imported goods, higher for dozens of countries. On February 20, 2026, the Court held that "IEEPA does not authorize the President to impose tariffs" (opinion in No. 24-1287).

Some of the refund money for those tariffs now sits with FedEx. Its results release of October 28 says its cash of $8 billion on September 30 ($7.96 billion on its balance sheet) "included approximately $2.7 billion in IEEPA tariff refunds held for refund to customers."

The amount has grown fast. FedEx’s June 23 release put the same line at about $800 million on May 31. By our calculation the refunds held rose by roughly $1.9 billion in four months, which only tells us more refund money reached FedEx in those months than left it.

FedEx’s quarterly report on Form 10-Q, filed the same day, shows how the money arrives. By September 30 FedEx had claimed $4.6 billion of refunds from U.S. Customs and Border Protection and received about $3.3 billion. It recorded $2.7 billion as estimated customer refund obligations and says it pays the refunds to customers “as soon as practicable.” The final amount and timing are still uncertain, the report adds.

Some tariff charges FedEx never collected from customers, and wrote off as losses, work the other way. When that money comes back, FedEx counts it as a cut in its bad debt expense, the cost of bills it could not collect.

Show the data

Part	Value	Squares
Tariff refunds held for customers	34%	34
The rest of FedEx cash	66%	66

It also changes how big FedEx’s cash pile looks. Take the refunds out and about $5.3 billion is left, by our calculation, although the release does not say how much of that is free to spend. FedEx also lists among its risks "any liability resulting from and the costs of defending against litigation, including refunds of tariffs." That line puts possible lawsuits over tariff refunds among the things FedEx says could cost it money.

FedEx 2026 forecast and the holiday quarter

In June the range was $16.90 to $18.10. The middle of the new range is 80 cents above the middle of June’s, a rise of 4.6% by our calculation. The range also got narrower, since its bottom moved more than its top.

FedEx also raised its revenue forecast for the calendar year, to growth of about 12% from about 11%.

Show the data

Item	Low	High	Value
June 23, 2026 forecast	$16.90	$18.10	$17.50
October 28, 2026 forecast	$18.00	$18.60	$18.30

A second forecast in the release looks far bigger. Under standard accounting rules, known as GAAP, FedEx now expects $35.30 to $35.90 a share, roughly double June’s range. Most of that jump is accounting. The new figure counts gains on retiring debt and on the FedEx Freight shares FedEx kept when it spun off that trucking business in June. The June figure left both out.

The forecast also tells you what FedEx needs from the holiday months. By our approximate calculation from its reported quarters, October to December would need about $6.03 to $6.63 of adjusted earnings per share for FedEx to land in the new range. That is 3% to 13% more than a year earlier.

The quarter just reported grew 28% on the same measure, by our calculation. October to December was FedEx’s biggest quarter of 2025, as its 2025 results restated on the new calendar show. FedEx says the forecast assumes "no additional adverse economic, geopolitical, or international trade-related developments."

In after-hours trading, the thinner trading after the 4 p.m. close, FedEx shares were at $299.00 at 4:58 p.m. ET, against $304.98 at the close. The prices come from StockTitan real-time Nasdaq data.

Why does a FedEx quarter now end in September?

FedEx’s board approved the change on January 27, 2025, according to an 8-K filing, a report companies file with regulators when something important happens. Under the old calendar, FedEx’s third quarter ran from December to February. That is why its March 19, 2026 release carried the same headline as Wednesday’s, "FedEx Reports Strong Third Quarter Results," for a different set of months.

The seven months from June 1 to December 31, 2026 form a transition period. FedEx will report them in a Transition Report on Form 10-K, the annual report companies file with the SEC, according to its filing of October 28. From then on its years follow the calendar, starting with the year ending December 31, 2027.

The same day the new calendar began, FedEx Freight left the group and FedEx split its reporting into two parts, Express U.S. Domestic and Express International.

Why FedEx net income fell while adjusted earnings rose

On June 1, 2026, FedEx spun off its freight trucking business as a separate company, FedEx Freight, and kept 19.9% of it. Those shares count as an investment, and the release says changes in their value "are recognized through net income." So when FedEx Freight’s share price moves, FedEx’s profit moves with it.

In July to September the stake lost $1.2 billion of value, which left it on FedEx’s books at $3.3 billion. The same stake had produced a $4.5 billion gain in April to June, according to the restated quarters FedEx filed on October 28.

Two other items pushed the other way. FedEx booked a $627 million gain before tax on bonds it bought back from investors through tender offers, offers of cash for the bonds. It also recorded a $263 million tax benefit tied to FedEx Supply Chain, which it sold to CMA CGM Group on October 1.

Show the data

Step	Value
Reported	$1.21
Freight stake loss	+$5.18
Debt gain	-$1.97
Restructuring, tax	-$0.68
Adjusted	$3.74

The delivery business itself earned more. Operating income, the profit from running the business, rose 10% to $1.07 billion, and as a share of revenue it barely moved.

FedEx stock buyback, dividend and debt

The June fourth quarter release said FedEx "intends to repurchase up to $1 billion worth of shares opportunistically" in calendar 2026, to offset the new shares it hands employees as pay.

The purchases took in about 6.3 million shares. Some came on the stock market and some through an accelerated share repurchase, a deal in which a bank hands the company a block of shares up front. FedEx says $4.3 billion is left under its 2026 buyback authorization, the amount its board has approved for share purchases.

The effect on each share’s profit was small. FedEx says the lower share count added 2 cents to the quarter’s earnings per share. Its average diluted share count, which also counts shares that employee stock awards could add, was 239 million. That is above the 237 million of a year earlier.

FedEx has declared a dividend of $1.22 a share in each of its last two quarterly declarations, the latest paid on October 1, according to its August dividend declaration.

Long-term debt, not counting the part due within a year, fell to $17.3 billion on September 30 from $20.3 billion at the end of 2025.

The July tender offers retired about $4.9 billion of bonds. On September 14 FedEx borrowed again, selling $1.1 billion of notes due 2036 and €2.0 billion of notes in euros, according to its 10-Q.

FedEx package volume and what it says about trade

At home, FedEx handled 14.4 million packages on an average day in July to September, up 2%, according to the statistics filed with the release. Its average U.S. revenue per package, which moves with prices and with the mix of services customers choose, rose 7%. UPS, which reported a day earlier, carried fewer U.S. packages than a year before, as our UPS earnings article explains.

Abroad the numbers split in two. In the same filed statistics, packages on FedEx’s slower international economy service rose 17%, and the weight of freight on its international routes rose 15%.

Packages FedEx delivers inside other countries fell 11%, and packages on its faster international priority service slipped 1%, so its total international package count fell 4%.

Show the data

Category	Change
U.S. packages	+2%
U.S. freight weight	+10%
International priority packages	-1%
International economy packages	+17%
Packages within other countries	-11%
International freight weight	+15%

FedEx credits its higher international operating results to "increased base yields, higher international export volume, and increased freight weight," base yields being roughly what it charges for its services. In the next sentence it names "the financial impact of global trade policy changes" as one of the things that held those results back, without putting a number on it.

Costs rose with the business. Fuel cost FedEx $1.27 billion in the quarter, 64% more than a year earlier, and the release also names higher rates paid to outside transport companies and higher wages. FedEx’s parcel rates go up by an average of 5.9% on January 4, 2027, the release says.

So trade runs through this report twice. Struck-down tariffs explain the refund money FedEx holds for its customers, and separately FedEx lists trade policy changes among the things that held back its international results.

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