FedEx continues to boom thanks to everyone buying things online

Actions of FedEx (FDX) it soared more than 6% on Friday after the transport giant reported revenue and revenue for its last quarter, which easily exceeded forecasts and provided a good outlook for 2021.

Sales rose more than 20% in the quarter to $ 21.5 billion, while net profit doubled to $ 890 million.

Much of the growth was due to the growing demand for products that people buy on their phones and computers, a trend that will not go away any time soon.

FedEx’s results are even more impressive given the company’s messy breakup Amazon (AMZN) in 2019. But FedEx has found many retailers willing to partner and has largely replaced Amazon’s lost revenue.

“We remain excited about the diversification and evolution of the e-commerce market,” FedEx marketing and communications manager Brie Carere said during a conference call with analysts Thursday evening. “Some of our largest retail customers reported e-commerce growth rates in high digits and even tripled by 2020,”

Carere added that e-commerce accounted for 20% of all U.S. retail sales in the fourth quarter of last year, significantly above pre-pandemic levels.

The outbreak of Covid-19 and the result of the resulting digital purchases have been a boom for both FedEx and its biggest rival SAI (SAI). FedEx shares have risen 150% in the last 12 months, while UPS shares have risen 70%.

Carere put aside concerns that FedEx would lose momentum as more people venture to buy the physical world again now that Covid-19 vaccines are on the rise.

He acknowledged that there is “the potential for a short-term slowdown in e-commerce purchases,” but that digital commerce would continue to grow as a percentage of the overall retail market.

FedEx and UPS, meanwhile, also benefit from contracts to ship Covid-19 vaccines and related supplies worldwide. This includes an agreement to the US to ship the Modern (MRNA) i Pfizer (PFE)/BioNTech (BNTX) shots and the recently approved single dose Johnson & Johnson (JNJ) vaccine.

Fred Smith, CEO of FedEx, said during the call from analysts that the company was transporting vaccines to more than 220 countries and territories around the world.

Vaccine delivery so far has been “almost flawless,” he added, noting that “you can count on your hand the number of problems with the number of vaccines we have delivered in the millions.”

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