11:33 AM EDT, 09/19/2025 (MT Newswires) -- FedEx ( FDX ) is bracing for a $1 billion trade-related impact in fiscal 2026, countered by $1 billion in cost savings, BofA Securities said Friday in a report.

Margins are still under pressure as international Express shipments decline and are replaced by lower-margin domestic growth, including rising volumes from Amazon.com, the report said.

On Thursday, FedEx ( FDX ) reported fiscal Q1 results that rose more than Wall Street expected, buoyed by domestic package revenue gains and cost reductions. The company reaffirmed full-year guidance of $17.20 to $19 a share, implying a 1% profit decline on 4% to 6% revenue growth, BofA said.

Management cited persistent industrial softness and excess capacity and now expects full-year Freight revenue to be flat to modestly higher, with margin deterioration likely until a H2 recovery, the report said.

Structural cost savings and the planned June 2026 FedEx Freight spinoff were cited as potential upside drivers, though macro risks and margin compression continue to loom, the report said.

BofA raised its price target on FedEx ( FDX ) stock to $244 from $240 and maintained its neutral rating.

FedEx ( FDX ) shares rose 2.7% in recent Friday trading.

Price: 232.56, Change: +6.06, Percent Change: +2.68