FedEx shareholders got a rude awakening just over a year ago after the company warned of a sharp drop in package deliveries and yanked its profit guidance. CEO Raj Subramaniam didn’t help matters by going on TV at the time to warn that “economic conditions are not going to be good.” Investors, spooked by the sudden post-COVID cooling of the logistics sector, drove the company’s shares down by 20% in just one day, the largest one-day drop in price.
The logistics company has since managed to turn things around, with shares up over 70% from lows in September 2022. At the Fortune Global Forum in Abu Dhabi on Wednesday, Subramaniam tried to explain what people are missing about the boom-and-bust shipping business. “If there was no pandemic … the trend would be kind of okay,” he said. He noted that e-commerce represented about 16% of retail pre-pandemic, surged to 22% during COVID, then stabilized back to 19%.
