U.S. LTL "Takeaways from the FDXF 4Q / Conf Call" Wadewitz

Research evidence excerpt

U.S. LTL "Takeaways from the FDXF 4Q / Conf Call" Wadewitz

Global Research

25 June 2026ab

U.S. LTL Equities

North AmericaTakeaways from the FDXF 4Q / Conf Call

Transportation Services

Thomas Wadewitz

Visibility to gradual improvement in LTL freight demand Analyst

FDXF held their first stand alone conference call and provided a framework for thomas.wadewitz@ubs.com

performance over the 7 month transition period (June - Dec). Shipments / day declined +1-212-713 6116

~6% y/y in both the May and February quarters but management indicated they see Michael Triano

positive signs of improving freight demand and they anticipate improving to ~ flat Analyst

shipments / day at the end of the 7 month transition period. Management pointed to a michael.triano@ubs.com

tighter truckload market and shipments moving from TL into LTL as being the primary +1-212-713 3822

driver of improving LTL demand. Michael DiMattia

Analyst

FDXF is expecting transition to positive base yield in June - Dec michael.dimattia@ubs.com

+1-617-748 5628

Revenue / hundredweight rose 8.2% y/y in 4QF26 and FDX indicated fuel surcharge was

the largest driver while a 3% rise in weight / shipment contributed to 11.5% growth in

revenue / shipment. FDXF indicated they expect base price to contribute to their 4% -

6% revenue growth guide for the 7 month period in addition to the tailwind y/y from

fuel surcharge and higher weight / shipment.

Stand alone / transition costs expected to rise before falling in 2HCY27

FDXF indicated they are incurring $600 mm or higher stand alone + transition service

agreement costs and this is likely to rise to $700 mm to $750 mm before it begins to

decline in 2HCY27. The decline is a function of gradually replacing the transition services