FedEx (FDX) 8-K FedEx Corp. Reports Strong Third Quarter Earnings Growth

Exhibit 99.1

FOR IMMEDIATE RELEASE

FedEx Corp. Reports Strong Third Quarter Earnings Growth

FedEx Ground Operating Income Increases 43%

MEMPHIS, Tenn., March 22, 2012 ... FedEx Corp. (NYSE: FDX) today reported earnings of $1.65 per diluted share for the third quarter ended February 29, which includes a $0.10 per share reversal of a reserve associated with a legal matter at FedEx Express. Last year’s third quarter earnings were $0.73 per diluted share, which included $0.08 per diluted share in costs related to the combination of the company’s FedEx Freight and FedEx National LTL operations. Excluding these one-time items, earnings were $1.55 per diluted share in the third quarter, compared to $0.81 per diluted share a year ago.

“FedEx Corp. results were driven by improving yields, record holiday package shipping and exceptional performance at FedEx Ground,” said Frederick W. Smith, FedEx Corp. chairman, president and chief executive officer. “We expect our solid performance to continue in our fourth quarter, capping off a strong fiscal year.”

Third Quarter Results

FedEx Corp. reported the following consolidated results for the third quarter:

• Revenue of $10.56 billion, up 9% from $9.66 billion the previous year

• Operating income of $813 million, up 107% from $393 million last year

• Operating margin of 7.7%, up from 4.1% the previous year

• Net income of $521 million, up 126% from $231 million a year ago

Operating income improved due to the continued strong performance of FedEx Ground driven by higher yields and volumes, as well as significantly improved results at FedEx Freight. Operating income also reflects the positive year-over-year impact, predominately at FedEx Express, of a benefit from the timing lag that exists between when fuel prices change and when indexed fuel surcharges automatically adjust. The company also benefitted from a lower tax rate and mild winter weather.

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Outlook

FedEx projects earnings to be $1.75 to $2.00 per diluted share in the fourth quarter and an adjusted $6.35 to $6.60 per diluted share for fiscal 2012. This guidance assumes the current market outlook for fuel prices and moderate growth in the global economy. Including the FedEx Express legal reserve reversal, earnings are expected to be $6.43 to $6.68 per diluted share for fiscal 2012. The company reported earnings of $1.75 per diluted share in last year’s fourth quarter. The capital spending forecast for fiscal 2012 remains $4.2 billion.

“We are pleased with the improved performance at FedEx Ground and FedEx Freight during our third quarter,” said Alan B. Graf, Jr., FedEx Corp. executive vice president and chief financial officer. “We are evaluating actions to adjust our FedEx Express U.S. domestic network capacity and improve efficiency.”

FedEx Express Segment

For the third quarter, the FedEx Express segment reported:

• Revenue of $6.54 billion, up 8% from last year’s $6.05 billion

• Operating income of $349 million, up 96% from $178 million a year ago

• Operating margin of 5.3%, up from 2.9% the previous year

U.S. domestic revenue per package grew 9% due to higher rate per pound and fuel surcharges, while average daily package volume decreased 4%. International priority (IP) revenue per package grew 5% due to higher fuel surcharges and package weights, while average daily package volume decreased 1%. IP freight average daily pounds increased 4% with revenue per pound up 2% due to higher fuel surcharges. In total, IP average daily package and freight pounds increased 2% and revenue increased 6% year-over-year.

Operating income and margin improved in the quarter, reflecting the year-over-year benefit of the fuel surcharge timing lag and the reversal of a $66 million reserve associated with a legal matter. One additional operating day benefitted this year’s results, while prior year results were negatively impacted by severe winter weather.

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FedEx Ground Segment

For the third quarter, the FedEx Ground segment reported:

• Revenue of $2.48 billion, up 14% from last year’s $2.18 billion

• Operating income of $465 million, up 43% from $325 million a year ago

• Operating margin of 18.8%, up from 14.9% the previous year

FedEx Ground average daily package volume grew 5%, driven by increases in FedEx Home Delivery services as well as the business-to-business market. Revenue per package increased 8% primarily due to increased rates and higher fuel surcharges. FedEx SmartPost average daily volume increased 13% primarily due to growth in e-commerce. FedEx SmartPost revenue per package increased 5% primarily due to increased fuel surcharges.

Operating income and margin increased primarily due to increased revenue per package and volume growth. During the year, we continued to shorten transit times by accelerating various lanes throughout the U.S. and Canada, which has led to consistently high on-time service.

FedEx Freight Segment

For the third quarter, the FedEx Freight segment reported:

• Revenue of $1.23 billion, up 10% from last year’s $1.12 billion

• Operating loss of $1 million, compared with an operating loss of $110 million a year ago

• Operating margin of (0.1%), up from (9.8%) the previous year

Less-than-truckload (LTL) yield increased 6% due to higher LTL fuel surcharges and base yield improvement. LTL average daily shipments increased 2% reflecting sequential improvement during the quarter and favorable comparisons due to severe winter weather in the prior year.

The operating results in the quarter improved significantly as a result of the positive impacts from higher yield and volume, milder winter weather, one additional business day, and ongoing improvements in operational efficiencies. In the prior year quarter, the segment incurred one-time costs of $43 million due to the January 30, 2011 combination of the FedEx Freight and FedEx National LTL operations.

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Corporate Overview

FedEx Corp. (NYSE: FDX) provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services. With annual revenues of $42 billion, the company offers integrated business applications through operating companies competing collectively and managed collaboratively, under the respected FedEx brand. Consistently ranked among the world’s most admired and trusted employers, FedEx inspires its more than 300,000 team members to remain “absolutely, positively” focused on safety, the highest ethical and professional standards and the needs of their customers and communities. For more information, visitnews.fedex.com.

Additional information and operating data are contained in the company’s annual report, Form 10-K, Form 10-Qs and third quarter fiscal 2012 Statistical Book. These materials, as well as a Webcast of the earnings release conference call to be held at 8:30 a.m. EDT on March 22 are available on the company’s Web site atinvestors.fedex.com. A replay of the conference call Webcast will be posted on our Web site following the call.

Certain statements in this press release may be considered forward-looking statements, such as statements relating to management’s views with respect to future events and financial performance. Such forward-looking statements are subject to risks, uncertainties and other factors which could cause actual results to differ materially from historical experience or from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions in the global markets in which we operate, legal challenges or changes related to FedEx Ground’s owner-operators, new U.S. domestic or international government regulation, the impact from any terrorist activities or international conflicts, our ability to effectively operate, integrate and leverage acquired businesses, changes in fuel prices and currency exchange rates, our ability to match capacity to shifting volume levels and other factors which can be found in FedEx Corp.’s and its subsidiaries’ press releases and filings with the SEC.

Media Contact: Jess Bunn 901-818-7463

Investor Contact: Mickey Foster 901-818-7468

Home Page: fedex.com

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RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

TO GAAP FINANCIAL MEASURES

The company believes that meaningful analysis of our financial performance requires an understanding of the factors underlying that performance and our judgments about the likelihood that particular factors will repeat. Excluding the reversal of a reserve associated with a legal matter at FedEx Express from current results and the costs of the combination of FedEx Freight and FedEx National LTL operations from our prior period third quarter earnings, net of applicable incentive compensation impacts, will allow for more accurate comparisons of our third quarter operating performance. As required by SEC rules, the tables below present a reconciliation of our presented non-GAAP measures to the most directly comparable GAAP measures.

		September 30,		September 30,
	Q3 FY12 Diluted Earnings Per  Share		Q3 FY11 Diluted Earnings Per  Share
Non-GAAP Measure	$	1.55	$	0.81
FedEx Freight Combination Costs		—		(0.08	)
ATA Legal Reserve Reversal		0.10		—
GAAP Measure	$	1.65	$	0.73

Fiscal 2012 Full-Year Earnings Guidance

		September 30,
	FY 2012 Diluted EPS Guidance
Non-GAAP Measure	$	6.35 to $6.60
ATA Legal Reserve Reversal		0.08
GAAP Measure	$	6.43 to $6.68

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FEDEX CORP. FINANCIAL HIGHLIGHTS

Third Quarter Fiscal 2012

(In millions, except earnings per share)

(Unaudited)

	Three Months Ended									Nine Months Ended
	Feb. 29, 2012			Feb. 28, 2011			%			Feb. 29, 2012			Feb. 28, 2011			%
Revenue:
FedEx Express segment	$	6,543		$	6,049			8	%	$	19,718		$	17,953			10	%
FedEx Ground segment		2,480			2,184			14	%		7,097			6,222			14	%
FedEx Freight segment		1,234			1,123			10	%		3,887			3,602			8	%
FedEx Services segment		401			397			1	%		1,239			1,246			(1	%)
Other & eliminations		(94	)		(90	)		NM			(269	)		(271	)		NM
Total Revenue		10,564			9,663			9	%		31,672			28,752			10	%
Operating Expenses:
Salaries and employee benefits		4,021			3,828			5	%		12,007			11,410			5	%
Purchased transportation		1,619			1,446			12	%		4,713			4,163			13	%
Rentals and landing fees		628			621			1	%		1,871			1,850			1	%
Depreciation and amortization		543			493			10	%		1,570			1,474			7	%
Fuel		1,233			1,049			18	%		3,677			2,874			28	%
Maintenance and repairs		456			480			(5	%)		1,518			1,470			3	%
Impairment and other charges		—			21			NM			—			88			NM
Other		1,251			1,332			(6	%)		3,986			3,933			1	%
Total Operating Expenses		9,751			9,270			5	%		29,342			27,262			8	%
Operating Income (Loss):
FedEx Express segment		349			178			96	%		979			799			23	%
FedEx Ground segment		465			325			43	%		1,270			908			40	%
FedEx Freight segment		(1	)		(110	)		99	%		81			(217	)		NM
Total Operating Income		813			393			107	%		2,330			1,490			56	%
Other Expense:
Interest, net		(12	)		(24	)		(50	%)		(30	)		(65	)		(54	%)
Other, net		(9	)		(9	)		—			(7	)		(25	)		(72	%)
Total Other Expense		(21	)		(33	)		(36	%)		(37	)		(90	)		(59	%)
Pretax Income		792			360			120	%		2,293			1,400			64	%
Provision for Income Taxes		271			129			110	%		811			506			60	%
Net Income	$	521		$	231			126	%	$	1,482		$	894			66	%
Diluted Earnings Per Share	$	1.65		$	0.73			126	%	$	4.67		$	2.82			66	%
Weighted Average Common and Common Equivalent Shares		316			317			—			317			316			—
Capital Expenditures	$	729		$	643			13	%	$	2,946		$	2,703			9	%

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FEDEX CORP. CONDENSED CONSOLIDATED BALANCE SHEETS

Third Quarter Fiscal 2012

(In millions)

		September 30,			September 30,
	Feb. 29, 2012 (Unaudited)			May 31, 2011
ASSETS
Current Assets
Cash and cash equivalents	$	2,040		$	2,328
Receivables, less allowances		4,635			4,581
Spare parts, supplies and fuel, less allowances		447			437
Deferred income taxes		617			610
Prepaid expenses and other		459			329
Total current assets		8,198			8,285
Property and Equipment, at Cost		35,933			33,686
Less accumulated depreciation and amortization		19,090			18,143
Net property and equipment		16,843			15,543
Other Long-Term Assets
Goodwill		2,419			2,326
Other assets		1,292			1,231
Total other long-term assets		3,711			3,557
	$	28,752		$	27,385
LIABILITIES AND STOCKHOLDERS’ INVESTMENT
Current Liabilities
Current portion of long-term debt	$	419		$	18
Accrued salaries and employee benefits		1,444			1,268
Accounts payable		1,687			1,702
Accrued expenses		1,602			1,894
Total current liabilities		5,152			4,882
Long-Term Debt, Less Current Portion		1,251			1,667
Other Long-Term Liabilities
Deferred income taxes		2,030			1,336
Pension, postretirement healthcare and other benefit obligations		1,654			2,124
Self-insurance accruals		960			977
Deferred lease obligations		750			779
Deferred gains, principally related to aircraft transactions		244			246
Other liabilities		142			154
Total other long-term liabilities		5,780			5,616
Commitments and Contingencies
Common Stockholders’ Investment
Common stock, $0.10 par value, 800 million shares authorized		32			32
Additional paid-in capital		2,574			2,484
Retained earnings		16,584			15,266
Accumulated other comprehensive loss		(2,483	)		(2,550	)
Treasury stock, at cost		(138	)		(12	)
Total common stockholders’ investment		16,569			15,220
	$	28,752		$	27,385

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FEDEX CORP. CONDENSED CONSOLIDATED

STATEMENTS OF CASH FLOWS

Third Quarter Fiscal 2012

(In millions)

(Unaudited)

		September 30,			September 30,
	Nine Months Ended
	Feb. 29, 2012			Feb. 28, 2011
Operating Activities:
Net income	$	1,482		$	894
Noncash charges:
Depreciation and amortization		1,570			1,474
Other, net		900			662
Changes in operating assets and liabilities, net		(935	)		(573	)
Net cash provided by operating activities		3,017			2,457
Investing Activities:
Capital expenditures		(2,946	)		(2,703	)
Business acquisitions, net of cash acquired		(114	)		(96	)
Proceeds from asset dispositions and other		20			15
Net cash used in investing activities		(3,040	)		(2,784	)
Financing Activities:
Principal payments on debt		(28	)		(262	)
Dividends paid		(123	)		(113	)
Purchase of treasury stock		(197	)		—
Other, net		90			75
Net cash used in financing activities		(258	)		(300	)
Effect of exchange rate changes on cash		(7	)		34
Net decrease in cash and cash equivalents		(288	)		(593	)
Cash and cash equivalents at beginning of period		2,328			1,952
Cash and cash equivalents at end of period	$	2,040		$	1,359

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FEDEX EXPRESS SEGMENT FINANCIAL AND OPERATING HIGHLIGHTS

Third Quarter Fiscal 2012

(Dollars in millions)

(Unaudited)

FINANCIAL HIGHLIGHTS	Three Months Ended									Nine Months Ended
	Feb. 29, 2012			Feb. 28, 2011			%			Feb. 29, 2012			Feb. 28, 2011			%
Revenue	$	6,543		$	6,049			8	%	$	19,718		$	17,953			10	%
Operating Expenses:
Salaries and employee benefits		2,410			2,321			4	%		7,200			6,832			5	%
Purchased transportation		449			386			16	%		1,346			1,143			18	%
Rentals and landing fees		425			424			—			1,269			1,254			1	%
Depreciation and amortization		299			267			12	%		869			787			10	%
Fuel		1,078			898			20	%		3,194			2,454			30	%
Maintenance and repairs		303			330			(8	%)		1,037			1,002			3	%
Intercompany charges		547			498			10	%		1,643			1,523			8	%
Other1		683			747			(9	%)		2,181			2,159			1	%
Total Operating Expenses		6,194			5,871			6	%		18,739			17,154			9	%
Operating Income	$	349		$	178			96	%	$	979		$	799			23	%
Operating Margin		5.3	%		2.9	%		2.4	pts		5.0	%		4.5	%		0.5	pts
OPERATING STATISTICS2
Operating Weekdays		63			62			2	%		191			190			1	%
AVG DAILY VOLUME / POUNDS
Average Daily Package Volume (000s):
U.S. Overnight Box		1,171			1,218			(4	%)		1,158			1,194			(3	%)
U.S. Overnight Envelope		581			631			(8	%)		586			627			(7	%)
U.S. Deferred		923			952			(3	%)		863			887			(3	%)
Total U.S. Domestic Package		2,675			2,801			(4	%)		2,607			2,708			(4	%)
International Priority3		552			558			(1	%)		555			569			(2	%)
International Domestic4		508			337			51	%		493			338			46	%
Total Average Daily Packages		3,735			3,696			1	%		3,655			3,615			1	%
Average Daily Freight Pounds (000s):
U.S.		8,104			8,000			1	%		7,561			7,447			2	%
International Priority3		3,257			3,131			4	%		3,279			3,158			4	%
International Airfreight		1,169			1,262			(7	%)		1,182			1,248			(5	%)
Total Avg Daily Freight Pounds		12,530			12,393			1	%		12,022			11,853			1	%
YIELD
Revenue Per Package:
U.S. Overnight Box	$	21.93		$	20.05			9	%	$	22.08		$	19.81			11	%
U.S. Overnight Envelope		11.65			10.87			7	%		11.59			10.68			9	%
U.S. Deferred		13.62			12.60			8	%		13.67			12.29			11	%
Total U.S. Domestic Package		16.83			15.45			9	%		16.94			15.23			11	%
International Priority3		59.78			57.07			5	%		60.88			55.06			11	%
International Domestic4		6.57			7.54			(13	%)		6.73			7.33			(8	%)
Composite Package Yield	$	21.79		$	21.01			4	%	$	22.23		$	20.77			7	%
Revenue Per Freight Pound:
U.S.	$	1.27		$	1.14			11	%	$	1.29		$	1.14			13	%
International Priority3		2.16			2.12			2	%		2.18			2.09			4	%
International Airfreight		1.04			0.88			18	%		1.01			0.88			15	%
Composite Freight Yield	$	1.48		$	1.36			9	%	$	1.51		$	1.37			10	%

1 -   Current year includes the reversal of a $66 million reserve for a legal matter.

2 -   Operating statistics include only the operations of FedEx Express.

3 -   International Priority includes FedEx International Priority^® and FedEx International Economy^® packages and     envelopes.

4 -   International Domestic includes the operations of acquisitions in India (February 2011) and Mexico (July 2011).

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FEDEX GROUND SEGMENT FINANCIAL AND OPERATING HIGHLIGHTS

Third Quarter Fiscal 2012

(Dollars in millions)

(Unaudited)

	Three Months Ended									Nine Months Ended
	Feb. 29, 2012			Feb. 28, 2011			%			Feb. 29, 2012			Feb. 28, 2011			%
FINANCIAL HIGHLIGHTS
Revenues:
FedEx Ground	$	2,259		$	2,001			13	%	$	6,518		$	5,756			13	%
FedEx SmartPost		221			183			21	%		579			466			24	%
Total Revenues		2,480			2,184			14	%		7,097			6,222			14	%
Operating Expenses:
Salaries and employee benefits		369			329			12	%		1,082			954			13	%
Purchased transportation		995			911			9	%		2,814			2,538			11	%
Rentals		74			68			9	%		212			197			8	%
Depreciation and amortization		102			84			21	%		289			249			16	%
Fuel		4			5			NM			11			9			NM
Maintenance and repairs		43			40			8	%		130			126			3	%
Intercompany charges		246			221			11	%		732			669			9	%
Other		182			201			(9	%)		557			572			(3	%)
Total Operating Expenses		2,015			1,859			8	%		5,827			5,314			10	%
Operating Income	$	465		$	325			43	%	$	1,270		$	908			40	%
Operating Margin		18.8	%		14.9	%		3.9	pts		17.9	%		14.6	%		3.3	pts
OPERATING STATISTICS
Operating Weekdays		63			63			—			191			191			—
Average Daily Package Volume (000s)
FedEx Ground		4,072			3,882			5	%		3,922			3,751			5	%
FedEx SmartPost		1,960			1,736			13	%		1,701			1,433			19	%
Yield (Revenue Per Package)
FedEx Ground	$	8.79		$	8.16			8	%	$	8.68		$	8.01			8	%
FedEx SmartPost	$	1.79		$	1.70			5	%	$	1.78		$	1.70			5	%

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FEDEX FREIGHT SEGMENT FINANCIAL AND OPERATING HIGHLIGHTS

Third Quarter Fiscal 2012

(Dollars in millions)

(Unaudited)

	Three Months Ended									Nine Months Ended
	Feb. 29, 2012			Feb. 28, 2011			%			Feb. 29, 2012			Feb. 28, 2011			%
FINANCIAL HIGHLIGHTS
Revenue	$	1,234		$	1,123			10	%	$	3,887		$	3,602			8	%
Operating Expenses:
Salaries and employee benefits		566			562			1	%		1,721			1,746			(1	%)
Purchased transportation		201			178			13	%		629			567			11	%
Rentals		29			29			—			86			94			(9	%)
Depreciation and amortization		47			48			(2	%)		135			158			(15	%)
Fuel		149			145			3	%		470			409			15	%
Maintenance and repairs		45			44			2	%		143			135			6	%
Intercompany charges		107			106			1	%		324			323			—
Impairment and other charges1		—			21			NM			—			88			NM
Other		91			100			(9	%)		298			299			—
Total Operating Expenses		1,235			1,233			—			3,806			3,819			—
Operating Income (Loss)	$	(1	)	$	(110	)		99	%	$	81		$	(217	)		NM
Operating Margin		(0.1	%)		(9.8	%)		9.7	pts		2.1	%		(6.0	%)		8.1	pts
OPERATING STATISTICS
LTL Operating Weekdays		63			62			2	%		190			189			1	%
LTL Shipments Per Day (000s)		79.8			78.3			2	%		83.8			86.6			(3	%)
Weight Per LTL Shipment (lbs)		1,157			1,151			1	%		1,154			1,133			2	%
LTL Revenue/CWT	$	19.70		$	18.66			6	%	$	19.59		$	18.04			9	%

1 -   Previous year includes charges associated with the combination of FedEx Freight and FedEx National LTL     operations.

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