FedEx : 2024 Annual Meeting of Stockholders 2024 Annual Report
FDX
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A N N U A L R E P O R T
DELIVERING WHAT'S NEXT. AS ONE.
One team. One vision. One FedEx.
To our FedEx stockholders,
Last year, FedEx celebrated 50 years of transforming the world by connecting people and possibilities. This year, we continued to advance our mission by ushering in a new era as one FedEx. FedEx Express, FedEx Ground, and FedEx Services are now one company: Federal Express Corporation.
This foundational change to our internal structure improves efficiency and reduces cost, allowing our teams to move with even greater speed and focus.
The world is rapidly changing, and we are evolving to help our customers compete and win with the world's smartest transportation and logistics network. Our structure is new, but our spirit is the same - ready and eager to embrace a new day as one team united in purpose and promise to deliver what's next.
As I reflect on the past year and the challenging demand environment, I am extremely proud of how the FedEx team delivered. This year has shown the true embodiment of our People-Service-Profit culture.
Through continued focus on revenue quality and disciplined execution, FedEx achieved year-over-year operating profit and margin expansion in every quarter of FY24. We lowered our capital intensity, reaching our FY25 target of less than 6.5% CapEx as a percentage of revenue a year early; and with more efficient operations, we returned nearly $4 billion to stockholders through dividends and stock repurchases.
In FY25 we aim to build upon our momentum to create a brighter and more connected future for our customers, team members, and communities.
Changing the way we work with DRIVE
DRIVE is a framework that enables us to see beyond our current state and explore new perspectives, possibilities, and approaches. It has created a rigor that allows us to consistently execute at a high level and rapidly adapt to changing market conditions. We achieved our target of $1.8 billion in structural cost-out in FY24.
Our performance through each and every quarter of FY24 shows the resiliency we are building into our business model. Looking ahead, we are firmly on track to achieve our target of $4 billion of savings in FY25 compared to the FY23 baseline, as DRIVE evolves from a targeted transformation effort to being the foundational framework for how we work.
Winning with digital
Innovation has always been a part of the FedEx DNA. When FedEx founder, Frederick W. Smith, declared over 40 years ago that the information about the package was as important as the package itself, it led to the development of the first system for customers to track their packages. Today, we are innovating with digital to make supply chains smarter for everyone.
The role of supply chains has fundamentally evolved in recent years. What was once a footnote in boardroom discussions has become a strategic imperative for business leaders across the globe.
The FedEx network has unique visibility into a world that connects millions of shippers with hundreds of millions of recipients, exchanging trillions of dollars of goods every year. We are using this data to reimagine our networks and offer better value propositions for our customers.
We are already seeing benefits of our digital solutions. For example, our new weather contingency playbook leverages predictive capabilities to proactively divert storm-bound volumes across our networks. By combining the power of digital insights and predictive analytics with our physical network, we effectively mitigated the impact of the January 2024 winter storm that hit our Express hub in Memphis by shifting Memphis-bound Express volume to Ground or Freight at the origin location. Despite this year's event having a longer impact on Memphis operations compared to a similar weather event in 2023, our network recovered twice as fast.
As our digital platform continues to grow, we will create even greater operational flexibility and efficiency for our customers and for our own enterprise.
2024 Annual Report
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Delivering What's Next. As One.
Reimagining the future
I want to express my sincere gratitude to both Rob Carter and Mark Allen for their remarkable careers in light of their upcoming retirements. Rob has been a part of FedEx for the last 31 years, serving as CIO for the last 24 years, where he led FedEx in modernizing our IT infrastructure. I'm immensely grateful to Rob for his numerous contributions in establishing FedEx as an innovative, data-driven and a people-focused company. We thank him for his dedication and service to FedEx over the years.
Mark has had a distinguished 42-year career with the company. He was named to his current role in 2017 and was a key member of the leadership team as we navigated the unprecedented challenges of a global pandemic, uncertain economy, and a wide variety of critical issues. His leadership and steady guidance of the legal, regulatory, governmental affairs, and security teams through an evolving landscape has helped lay the groundwork for a strong future as one FedEx. We wish Rob, Mark, and their families health and happiness in their next chapters.
This is one of the most pivotal moments in FedEx history. We have the right team and the right strategy to achieve our long-term financial goals, and I have never been more confident in our direction.
We have a long runway of value creation opportunities in front of us as we continue to win profitable share, reimagine our network, and harness the power of the data we generate moving 15 million packages globally each day.
I am excited about the opportunities ahead as we continue to focus on enhancing our profitability and stockholder returns, while providing outstanding service for our customers. And we are doing this the right way, with an utmost focus on safety, using our networks for good, and building towards a more sustainable future.
We are writing a new chapter for FedEx, and we will get there through our incredible culture and people - who always deliver and inspire what's next.
Sincerely,
RAJ SUBRAMANIAM
President & CEO, FedEx Corporation
See "Forward-Looking Statements" and "Risk Factors" on pages 24-37 of the FY24 FedEx Corporation Annual Report on Form 10-K, included herein, for a discussion of potential risks and uncertainties that could materially affect our future performance.
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
For the fiscal year ended May 31, 2024.
OR
For the transition period from
FedEx Corporation
(Exact Name of Registrant as Specified in its Charter)
Delaware
62-1721435
(State or Other Jurisdiction of
(I.R.S. Employer
Incorporation or Organization)
Identification No.)
942 South Shady Grove Road, Memphis, Tennessee
38120
(Address of Principal Executive Offices)
(ZIP Code)
Registrant's telephone number, including area code: (901) 818-7500
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange on which registered
Common Stock, par value $0.10 per share
FDX
New York Stock Exchange
0.450% Notes due 2025
FDX 25A
New York Stock Exchange
1.625% Notes due 2027
FDX 27
New York Stock Exchange
0.450% Notes due 2029
FDX 29A
New York Stock Exchange
1.300% Notes due 2031
FDX 31
New York Stock Exchange
0.950% Notes due 2033
FDX 33
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☑ No ☐
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. Yes ☐ No ☑
Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☑ No ☐
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☑
Accelerated filer ☐
Non-accelerated filer ☐
Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the Registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the Registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☑
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
The aggregate market value of the common stock held by non-affiliates of the Registrant, computed by reference to the closing price as of the last business day of the Registrant's most recently completed second fiscal quarter, November 30, 2023, was approximately $59.5 billion. The Registrant has no non-voting stock.
As of July 11, 2024, 244,302,246 shares of the Registrant's common stock were outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's definitive proxy statement to be delivered to stockholders in connection with the 2024 annual meeting of stockholders to be held on September 23, 2024 are incorporated by reference in response to Part III of this Report.
FORWARD-LOOKING STATEMENTS
Certain statements in this Annual Report on Form 10-K (this "Annual Report"), including (but not limited to) those contained in "Item
As a result of these and other factors, no assurance can be given as to our future results and achievements. Accordingly, a forward- looking statement is neither a prediction nor a guarantee of future events or circumstances and those future events or circumstances may not occur. You should not place undue reliance on the forward-looking statements, which speak only as of the date of this report. We are under no obligation, and we expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events, or otherwise.
TABLE OF CONTENTS
Page
PART I
ITEM 1. Business
2
ITEM 1A. Risk Factors
24
ITEM 1B. Unresolved Staff Comments
37
ITEM 1C. Cybersecurity
37
ITEM 2. Properties
38
ITEM 3. Legal Proceedings
42
ITEM 4. Mine Safety Disclosures
42
Information about our Executive Officers
43
PART II
ITEM 5. Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities
45
ITEM 6. [RESERVED]
45
ITEM 7. Management's Discussion and Analysis of Results of Operations and Financial Condition
46
ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk
71
ITEM 8. Financial Statements and Supplementary Data
72
ITEM 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
116
ITEM 9A. Controls and Procedures
116
ITEM 9B. Other Information
116
ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
116
PART III
ITEM 10. Directors, Executive Officers, and Corporate Governance
117
ITEM 11. Executive Compensation
117
ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
117
ITEM 13. Certain Relationships and Related Transactions, and Director Independence
117
ITEM 14. Principal Accountant Fees and Services
117
PART IV
ITEM 15. Exhibits and Financial Statement Schedules
118
ITEM 16. Form 10-K Summary
126
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PART I
ITEM 1. BUSINESS
Overview
FedEx Corporation ("FedEx") was incorporated in Delaware on October 2, 1997 to serve as the parent holding company and provide strategic direction to the FedEx portfolio of companies. FedEx provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce, and business services, offering integrated business solutions utilizing its flexible, efficient, and intelligent global network.
Our website is located at fedex.com. Detailed information about our services, e-commerce tools and solutions, and environmental, social, and governance ("ESG") initiatives can be found on our website. In addition, we make our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all exhibits and amendments to such reports available, free of charge, through our website, as soon as reasonably practicable on the day they are filed with or furnished to the SEC. The Investor Relations page of our website, investors.fedex.com, contains a significant amount of information about FedEx, including our SEC filings and financial and other information for investors. The information that we post on the Investor Relations page of our website could be deemed to be material information. We encourage investors, the media, and others interested in FedEx to visit this website from time to time, as information is updated and new information is posted. The information on our website, however, is not incorporated by reference in, and does not form part of, this Annual Report. Except as otherwise specified, any reference to a year in this Annual Report indicates our fiscal year ended May 31 of the year referenced.
One FedEx Consolidation and New Reportable Segments
In the fourth quarter of 2023, we announced one FedEx, a consolidation plan to bring FedEx Ground Package System, Inc. ("FedEx Ground") and FedEx Corporate Services, Inc. ("FedEx Services") into Federal Express Corporation ("Federal Express"), becoming a single company operating a unified, fully integrated air-ground express network under the respected FedEx brand. On June 1, 2024, FedEx Ground and FedEx Services were merged into Federal Express. FedEx Freight, Inc. ("FedEx Freight") continues to provide less-than-truckload ("LTL") freight transportation services as a separate subsidiary. Beginning in the first quarter of 2025, Federal Express and FedEx Freight will represent our major service lines and constitute our reportable segments. FedEx Custom Critical, Inc. ("FedEx Custom Critical") will be included in the FedEx Freight segment instead of the Federal Express segment beginning in 2025.
Additionally, the FedEx Dataworks, Inc. ("FedEx Dataworks") operating segment is focused on creating solutions to transform the digital and physical experiences of our customers and team members. The FedEx Office and Print Services, Inc. ("FedEx Office") operating segment provides document and business services and retail access to our package transportation businesses and the FedEx Logistics, Inc. ("FedEx Logistics") operating segment provides customs brokerage and global ocean and air freight forwarding, as well as integrated supply chain management solutions through FedEx Supply Chain Distribution System, Inc. ("FedEx Supply Chain"). FedEx Dataworks, FedEx Office, and FedEx Logistics are included in "Corporate, other, and eliminations" in our segment reporting. There will be no changes to "Corporate, other, and eliminations" in 2025 following the one FedEx consolidation. For more information about FedEx Dataworks, FedEx Office, and FedEx Logistics, please see "FedEx Dataworks Operating Segment," "FedEx Office Operating Segment," and "FedEx Logistics Operating Segment" under "Business Segments" below. For more information about our new reportable segments beginning in the first quarter of 2025, please see "Business Segments" below.
During 2024 and 2023, our reportable segments were FedEx Express, the world's largest express transportation company; FedEx Ground, a leading North American provider of small-package ground delivery services; FedEx Freight Corporation, a leading North American provider of LTL freight transportation services; and FedEx Services, which provided sales, marketing, information technology, communications, customer service, technical support, billing and collection services, and certain back-office functions that supported our operating segments. For financial information concerning our reportable segments in place during 2024 and 2023, refer to "Item 7. Management's Discussion and Analysis of Results of Operations and Financial Condition" and "Item 8. Financial Statements and Supplementary Data" of this Annual Report. Part I of this Annual Report contains certain references to the financial and operational performance of our reportable segments in place during 2024 and 2023. Additional information regarding our reportable segments in place during 2024 and 2023 can be found in "Item 1. Business" and "Item 2. Properties" of our Annual Report for the year ended May 31, 2023. Certain statistical information in Part I of this Annual Report is presented as of June 7, 2024, the earliest practicable date following the one FedEx consolidation.
Strategy
The collective FedEx brand gives us our competitive edge. Further, our strategy allows us to manage our business as a portfolio, in the long-term best interest of the enterprise. As a result, we base decisions on capital investment and service additions or enhancements upon achieving the highest overall long-term return on invested capital for our business as a whole. We focus on making appropriate
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investments in the technology and assets necessary to optimize our long-term earnings performance and cash flow. Our business strategy also provides flexibility in structuring our network to align with varying macroeconomic conditions and customer demand for the market segments in which the customer operates, allowing us to leverage and manage change. Volatility, uncertainty, and innovation have become the norms in the global transportation market, and we are able to use our flexibility to accommodate changing conditions in the global economy.
For more than 50 years, we built networks that have created a differentiated and unmatched portfolio of services while continuously evolving to meet the changing needs of our customers and the market. With the recent significant growth of e-commerce and as our service mix continues to shift to deferred services, we are continuing to evolve to improve our operational efficiency and enhance profitability through one FedEx, Network 2.0 (our multi-year effort to improve the efficiency with which FedEx picks up, transports, and delivers packages in the U.S. and Canada), and DRIVE (our comprehensive program to improve long-term profitability). We are building a simplified experience to better serve our customers with enhanced capabilities and transforming to operate with more flexibility, efficiency, and intelligence.
We have implemented Network 2.0 in more than 50 locations in the U.S. and began the phased transition of all legacy FedEx Ground operations and personnel in Canada to Federal Express surface operations in April 2024. As we optimize our network under Network 2.0, Federal Express will continue to utilize both employee couriers and contracted service providers in U.S. surface operations using a market-by-market approach. Additionally, in 2024 we announced Tricolor, the redesign of the Federal Express international air network as part of the DRIVE program to improve efficiency and asset utilization. See "Business Segments" below, "Item 1A. Risk Factors," and "Item 7. Management's Discussion and Analysis of Results of Operations and Financial Condition" of this Annual Report for more information on one FedEx, Network 2.0, and DRIVE. One FedEx and Network 2.0 will leverage the strength of our networks, people, and assets in more efficient ways, enabling a distinct focus on air and international volume while facilitating a more holistic approach to how we move packages on the ground.
Innovation inspired our start at FedEx over 50 years ago, and it is fueling our future as we combine logistics with digital intelligence. Leveraging the capabilities of FedEx Dataworks, developments in data and technology, including artificial intelligence and machine learning, are facilitating the execution of our DRIVE transformation by creating new opportunities to improve our operational efficiency. See "Business Segments" below for more information. The size and scale of our global network gives us key insights into global supply chains and trends. This foundation provides an immense amount of data we can use to build better insights, improve the customer experience, and differentiate our service offerings. To fully harness the power of this data, FedEx Dataworks is focused on putting our data into context and using it to enhance the efficiency of the FedEx network and the end-to-end experience of our customers by making supply chains smarter for everyone.
In January 2024, we announced fdx, a fully integrated data-driven commerce platform that connects the entire customer journey. See "Federal Express Segment - Customer-Driven Technology - E-Commerce and Digital Solutions" below for more information. In early 2025 we formed a new enterprise-wide Data & Technology team, which is focused on initiatives to streamline the technology used during the package delivery lifecycle; establish global standards across pickup-and-delivery, linehaul, sort, and clearance operations; and improve digital products and experiences for the FedEx enterprise and our customers.
"Safety Above All" is the first and foremost value in every aspect of our business. We are committed to making our workplaces and communities safer for our team members, customers, and the public. This philosophy is embedded in our day-to-day work through rigorous policies, continual education and engagement, and investments in technology designed to prevent accidents.
Through our global transportation, information technology, and retail networks, we help to facilitate an ongoing and unprecedented expansion of customer access - to goods, services, and information. We believe it would be extremely difficult, costly, and time- consuming to replicate our global network, which reflects decades of investment, innovation, and expertise, includes the world's largest all-cargo air fleet, and connects more than 99% of the world's gross domestic product. We continue to position our company and team members to facilitate and capitalize on this access and to achieve stronger long-term growth, productivity, and profitability.
During 2024 and early 2025, we introduced and expanded a number of innovative solutions, advanced important long-term business initiatives, and made other important investments that benefit our customers, team members, communities, and other stakeholders, including:
In June 2024, we announced that FedEx's management and Board of Directors are conducting an assessment of the role of FedEx Freight in the company's portfolio structure.
Business Segments
The following describes in more detail the operations of each of our principal operating segments beginning in the first quarter of 2025:
Federal Express Segment
Overview
Federal Express pioneered the express transportation industry over 50 years ago in 1973 and remains the industry leader today, providing a range of rapid, reliable, time- and day-definite delivery services to more than 220 countries and territories through an integrated air-ground express network. In connection with our one FedEx consolidation, on June 1, 2024 FedEx Ground and FedEx Services were merged into Federal Express.
As of June 7, 2024, Federal Express employed approximately 430,000 employees and had approximately 64,000 drop-off locations (including FedEx Office stores and FedEx OnSite locations, such as nearly 17,000 Walgreens, Dollar General, and Albertsons stores), nearly 700 aircraft, and over 175,000 motorized vehicles in its global network. Federal Express contracts with approximately 6,000 independent small businesses to conduct certain linehaul and pickup-and-delivery operations. See "Operations" below for information regarding the consolidation of these operations into the surface operations of Federal Express. Federal Express also provides cross- border enablement and technology solutions and e-commerce transportation solutions.
U.S. and Canadian Services
Federal Express offers a wide range of U.S. domestic and Canadian shipping services for delivery of packages and freight. Federal Express offers three U.S. domestic overnight package delivery services: FedEx First Overnight, FedEx Priority Overnight, and FedEx Standard Overnight. FedEx SameDay service is available 365 days a year throughout all 50 states for urgent shipments up to 150 pounds. Federal Express also offers U.S. express overnight and deferred freight services to handle the needs of the time-definite freight market.
Federal Express is also a leading provider of day-definite business and residential package delivery services for packages weighing up to 150 pounds. Federal Express service reaches 100% of the continental U.S. population and nearly 100% of the Canadian population. Federal Express offers residential delivery service to 99% of the U.S. population on Saturdays and more than half of the U.S. population on Sundays. Federal Express also offers an economy service that is available for the consolidation and delivery of high volumes of low-weight, less time-sensitivebusiness-to-consumer packages to any residential address or P.O. Box in the U.S.
International Services
Federal Express offers a wide range of international shipping services for delivery of packages and freight, connecting markets that generate more than 99% of the world's gross domestic product. FedEx international package services include a money-back guarantee. Federal Express's unmatched air route authorities and extensive transportation infrastructure, combined with leading-edge information technologies, make it the world's largest express transportation company.
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International express and deferred package delivery is available to more than 220 countries and territories, with a variety of time- definite services to meet distinct customer needs. FedEx International Economy provides time-definite delivery typically in two to five business days. FedEx International First provides time-definite delivery to select postal codes in more than 25 countries and territories, with delivery to select U.S. ZIP Codes as early as 8:00 a.m. from more than 90 countries and Caribbean islands in one or two business days, delivery by 10:00 a.m. in one business day from the U.S. to Canada, and by 11:00 a.m. in one business day from the U.S. to Mexico. Federal Express also offers domestic pickup-and-delivery services within certain non-U.S. countries, including France, the United Kingdom, Australia, Brazil, Italy, Canada, Mexico, Poland, India, China, and South Africa. In addition, Federal Express offers comprehensive international express and deferred freight services, real-time tracking, and advanced customs clearance.
Our FedEx International Priority service provides end-of-daytime-definite delivery in one to three business days to more than 220 countries and territories, and our FedEx International Priority Express service provides midday time-definite delivery in one to three business days to more than 25 countries and territories. Additionally, FedEx International Connect Plus, a contractual e-commerce service currently available from nearly 60 origin countries to over 190 destination countries, provides day-definite delivery typically within two to five business days.
Operations
Federal Express's largest sorting facility, located in Memphis, serves as the center of the company's multiple hub-and-spoke system and worldwide air network. A second national air hub facility is located in Indianapolis. We are making investments over multiple years in our facilities to expand and modernize our Indianapolis hub and modernize our Memphis hub. See the "Financial Condition
Facilities at airports in Anchorage, Paris, Cologne, Guangzhou, and Osaka serve as sorting facilities for express package and freight traffic moving to and from Asia, Europe, and North America. Additional major sorting and freight handling facilities are located at Narita Airport in Tokyo and Stansted Airport outside London. The facilities in Paris, Cologne, Guangzhou, and Osaka are also designed to serve as regional air hubs for their respective market areas. A facility in Miami serves our South Florida, Latin American, and Caribbean markets. A central air hub near Liege, Belgium connects specific large European markets. In addition to its worldwide air network, Federal Express operates road networks in North America, Europe, the Middle East, Asia, Australia, and South America. Federal Express's unique European road network connects more than 45 countries and territories through 28 transit hubs and more than 600 stations.
With the recent significant growth of e-commerce and as our service mix continues to shift to deferred services, we are fundamentally redesigning our international air network in connection with our DRIVE transformation program. The redesigned network will continue to deploy FedEx-owned aircraft in the delivery of International Priority parcel shipments using our existing hub-and-spoke model. Additionally, a portion of our owned aircraft fleet will be retimed to operate off-cycle, allowing us to build density, decongest hubs, and connect our global surface networks. Finally, we will continue to leverage our global partner network as an adaptive capacity layer, particularly on imbalanced trade lanes, to move e-commerce and deferred volumes.
Throughout its worldwide network, Federal Express operates city stations and employs a staff of customer service agents, cargo handlers, and couriers who pick up and deliver shipments in the station's service area. In some international areas, independent agents ("Global Service Participants") have been selected to complete deliveries and to pick up packages. For more information about our sorting and handling facilities, see "Item 2. Properties" of this Annual Report under the caption "Federal Express Segment."
Federal Express also operates a highly flexible surface network of over 700 legacy FedEx Ground sortation and distribution facilities, including 165 fully automated stations, as of June 7, 2024. Federal Express conducts these operations in the U.S. primarily with more than 95,000 motorized vehicles owned or leased by independent service providers. Through Network 2.0, the multi-year effort to improve the efficiency with which we pick up, transport, and deliver packages in the U.S. and Canada, these operations are being consolidated into the surface operations of Federal Express. We have implemented Network 2.0 in more than 50 locations in the U.S. and began the phased transition of all legacy FedEx Ground operations and personnel in Canada to Federal Express surface operations in April 2024. Under Network 2.0, Federal Express will continue to utilize both its employee couriers and contracted service providers in U.S. surface operations using a market-by-market approach. See "Item 1A. Risk Factors" and "Item 7. Management's Discussion and Analysis of Results of Operations and Financial Condition" of this Annual Report for more information on Network 2.0.
Federal Express continues to maximize the use of existing U.S. surface facilities through Network 2.0. Many of these facilities utilize advanced automated unloading and sorting technology to streamline the handling of millions of packages daily. This technology includes a yard management system in many facilities which interacts with GPS tags on trailers to automatically notify the control
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Disclaimer
FedEx Corporation published this content on 27 August 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on August 27, 2024 at 21:59:01 UTC.