FedEx reported QQ1 2026 revenue of $22.244 billion, up 0.6% year over year and 0.38% quarter over quarter, with a gross profit of $5.786 billion and a gross margin of 26.01%. Operating income was $1.186 billion (operating margin 5.33%), while net income stood at $0.824 billion and earnings per diluted share of $3.46 (reported $3.48). Despite modest top-line growth, profitability deteriorated meaningfully versus the prior year, with operating income down 40.3% year over year and net income down 44.1% as the company absorbed higher costs and non-operating items. EBITDA was $2.226 billion, delivering an EBITDA margin of approximately 10.0%. The quarter’s expense structure included cost of revenue of $16.458 billion and other expenses of $4.60 billion, contributing to a total cost base of roughly $21.058 billion. The year-over-year deterioration in earnings occurred despite a small revenue uptick, underscoring ongoing margin pressure from fixed-cost intensity, mix effects, and incremental costs in the first quarter of calendar 2026. Management is expected to emphasize cost discipline, network optimization, and pricing actions as levers for margin recovery, along with disciplined capital allocation. In sum, the quarter confirms a stable revenue base in a constrained margin environment, with the path to improved profitability hinging on efficiency gains and pricing power amid competitive dynamics in global logistics.