FedEx

2025 separation and other cost presentation was reclassified from "Other" to conform to the current period presentation, with no impact on total operating income or net income.

A decline in U.S. imports of consumer goods that started in late 2022, slowed global industrial production, and recent changes in U.S. and international trade policy weakened business conditions, lowering shipment volumes.

Actual results may differ materially from those contemplated (expressed or implied) by such forward-looking statements because of, among other things, potential risks and uncertainties, such as:

•economic conditions in the global markets in which we operate;

•significant changes in the volumes of shipments transported through our networks, customer demand for our various services, or the prices we obtain for our services;

•geopolitical developments and uncertainty and/or additional volatility in the global trade environment;

•the price and availability of jet and vehicle fuel;

•failure to successfully implement our business strategy and effectively respond to changes in market dynamics and customer preferences;

-44-

Table of Contents

•our ability to execute our transformation initiatives, including Network 2.0 and the redesign of the Federal Express international air network, in the expected time frame and at the expected cost and achieve the expected operational efficiencies and network flexibility, alignment of our cost base with demand, cost savings and reductions to our permanent cost structure, and other benefits while managing the potential risks;

•our ability to achieve our calendar 2029 financial performance targets;

•our ability to successfully implement the planned tax-free spin-off of the FedEx Freight business into a new publicly traded company and achieve the anticipated benefits of such transaction;

•the timing and amount of any costs or benefits or any specific outcome, transaction, or change (of which there can be no assurance), or the terms, timing, and structure thereof, related to our global transformation program and other ongoing reviews and initiatives;

•a significant data breach or other disruption to our technology infrastructure, and our ability to mitigate the technological, operational, legal and regulatory, and reputational risks related to emerging technologies such as autonomous technology and artificial intelligence;

•the future rate of e-commerce growth and our ability to successfully expand our e-commerce services portfolio;

•increased insurance and claims expenses related to vehicle accidents, workers’ compensation claims, property and cargo loss, general business liabilities, and benefits paid under employee disability programs;

•failure to receive or collect expected insurance coverage;

•the effect of any international conflicts or terrorist activities on the United States and global economies in general, the transportation industry, or FedEx in particular;

•failure of third-party service providers to perform as expected, or disruptions in our relationships with those providers or their provision of services to FedEx;

•widespread outbreak of an illness or any other communicable disease or public health crisis;

•damage to our reputation or loss of brand equity;

•the effect of intense competition on our ability to maintain or increase our prices (including our fuel surcharges) or to maintain or grow our revenue and market share;

•our ability to manage our network capacity and cost structure for capital expenditures and operating expenses, and match it to shifting and future customer volume levels;

•our ability to execute and effectively operate, integrate, leverage, and grow acquired businesses, and to continue to support the value we allocate to these acquired businesses;

•uncertainties relating to entry into the conditional agreement, as a member of a consortium, to invest in InPost, including completion of regulatory approvals, entry into commercial arrangements with InPost, and the realization of expected benefits from the investment;

•noncash impairment charges related to our goodwill and certain deferred tax assets;

•failure to attract and retain employee talent and our ability to meet our labor and purchased transportation needs while controlling related costs and maintain our company culture;

•our ability to maintain good relationships with our employees and avoid attempts by labor organizations to organize groups of our employees, which could significantly increase our operating costs and reduce our operational flexibility, as well as the outcome of negotiations to reach new collective bargaining agreements (including with the pilots of Federal Express);

•increasing costs, the volatility of costs and funding requirements, and other legal mandates for employee benefits, especially pension and healthcare benefits;

•the effects of global climate change;

•our ability to achieve or demonstrate progress on our goal of carbon neutrality for our global operations by calendar 2040;

-45-

Table of Contents

•our ability to quickly and effectively restore operations following adverse weather or a localized disaster or disturbance in a key geography;

•any effects on our businesses resulting from evolving or new U.S. domestic or international government regulations, laws, policies, and actions, which could be unfavorable to our business, including labor (such as joint employment standards or changes to the Railway Labor Act of 1926, as amended, affecting Federal Express employees); regulatory or other actions affecting data protection; global aviation or other transportation rights, including regulatory and/or legal compliance requirements that can affect our ability to efficiently or fully utilize our aircraft; increased air cargo, pilot flight and duty time, and other security or safety requirements; import and export controls; the use of new technology and accounting; changes to global trade policies; foreign exchange intervention in response to currency volatility; environmental (such as global climate change legislation); or postal rules;

•adverse changes in tax laws, regulations, and interpretations, challenges or judicial decisions related to tariffs and our tax positions;

•increasing costs related to changing and heightened regulations and enforcement related to data protection;

•the increasing costs of compliance with federal, state, and foreign governmental agency mandates (including the Foreign Corrupt Practices Act and the U.K. Bribery Act) and defending against inappropriate or unjustified enforcement or other actions by such agencies;

•loss or delay in the collection of accounts receivable, including those related to tariffs in light of recent judicial rulings;

•changes in foreign currency exchange rates, especially in the euro, Chinese yuan, British pound, Canadian dollar, Australian dollar, Mexican peso, Hong Kong dollar, and Japanese yen, which can affect our sales levels and foreign currency sales prices;

•any liability resulting from and the costs of defending against class-action, derivative, and other litigation, such as wage-and-hour, joint employment, securities, vehicle accident, and discrimination and retaliation claims, claims related to our reporting and disclosure of environmental and sustainability topics, claims seeking refunds of tariffs and any other legal or governmental proceedings, including the matters discussed in Note 9 of the accompanying unaudited condensed consolidated financial statements;

•the effect of technology developments (including artificial intelligence and machine learning) on our operations and on demand for our services, and our ability to continue to identify and eliminate unnecessary information-technology redundancy and complexity throughout the organization;

•the sufficiency of insurance coverage we purchase;

•disruptions in global supply chains, which can limit the access of FedEx and our service providers to vehicles and other key capital resources and increase our costs;

•difficulties experienced by the companies with which we contract to fly smaller regional “feeder” aircraft in attracting and retaining pilots, which could cause a reduction of service offered to certain locations, service disruptions, increased costs of operations, and other difficulties;

•governmental underinvestment in transportation infrastructure, which could increase our costs and adversely affect our service levels due to traffic congestion, prolonged closure of key thoroughfares, or sub-optimal routing of our vehicles and aircraft;

•successful completion of stock repurchases;

•constraints, volatility, or disruption in the capital markets, our ability to maintain our current credit ratings, commercial paper ratings, and senior unsecured debt and pass-through certificate credit ratings, and our ability to meet credit agreement financial covenants; and

•other risks and uncertainties you can find in our press releases and SEC filings, including the risk factors identified under Part I, Item IA.

Areas where the nature of the estimate makes it reasonably possible that actual results could materially differ from amounts estimated include self-insurance accruals, retirement plan obligations, long-term incentive accruals, tax liabilities, loss contingencies, litigation claims, impairment assessments on long-lived assets (including goodwill) that rely on projections of future cash flows, and purchase price allocations.

NOTE 2: RECENT ACCOUNTING GUIDANCE

New accounting rules and disclosure requirements can significantly affect our reported results and the comparability of our financial statements. We believe the following new accounting guidance is relevant to the readers of our financial statements.

Recently Adopted Accounting Standards

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The new requirements enhance detail regarding the amount of cash taxes paid and the reconciliation of our effective tax rate. We adopted this standard effective June 1, 2025 (fiscal 2026) on a prospective basis.

CONSOLIDATED RESULTS

The following table compares summary operating results (dollars in millions, except per share amounts) for the years ended May 31:

| | | | | | | | | | | | | | | | | |
| | 2026 | | 2025 | | Percent Change
| Consolidated revenue | $ | 94,720 | | | $ | 87,926 | | | 8 |
| Operating income (loss): | | | | |
| Federal Express segment | 5,912 | | | 4,885 | | | 21 |
| FedEx Freight segment | 616 | | | 1,489 | | | (59) |
| Corporate, other, and eliminations | (1,065) | | | (1,157) | | | (8) |
| Consolidated operating income | $ | 5,463 | | | $ | 5,217 | | | 5 |
| Operating margin: | | | | |
| Federal Express segment | 7.2 | % | | 6.5 | % | | 70 | bp
| FedEx Freight segment | 7.0 | % | | 16.7 | % | | (970) | bp
| Consolidated operating margin | 5.8 | % | | 5.9 | % | | (10) | bp
| Consolidated net income | $ | 4,433 | | | $ | 4,092 | | | 8 |
| Diluted earnings per share | $ | 18.55 | | | $ | 16.81 | | | 10 |

The following table shows changes in revenue and operating income results by reportable segment for 2026 compared to 2025 (in millions):