(Reuters) - Shares of FedEx ( FDX ) climbed 5% in premarket trading on Friday, as investors cheered the parcel delivery major's quarterly profit and revenue beat against a backdrop of tariff-related uncertainty and the end of the "de minimis" exemption on low-value shipments.

FedEx's ( FDX ) aggressive cost-cutting measures, including parking planes, closing facilities and merging some of its units, helped to protect profits. It has a $1 billion cost-saving plan for this fiscal year ending in May 2026.

Its performance was also driven by a 5% jump in domestic average daily volumes, while its operating margin, a closely watched metric, increased to 6% from 5.2%, which signaled that U.S. consumer demand was resilient.

"FedEx's ( FDX ) solid first quarter and issuance of a FY26 guide was a positive surprise for a company that has been battered by a wide array of headwinds," said J.P. Morgan analysts.

Shares of rival United Parcel Service were up more than 1%.

FedEx ( FDX ) reported a rise in adjusted profit per share to $3.83 from $3.60 a year earlier, surprising Wall Street analysts, who expected a fall in earnings due to the end of "de minimis" exemptions, which allowed shipments valued under $800 to enter the U.S. duty-free.

The company said global tariffs, including the end of the de minimis exemption for China and Hong Kong, cut first-quarter revenue by $150 million, a hit expected to recur each quarter this year. Combined with other pressures, trade policies represent a $1 billion headwind for FY26, Chief Customer Officer Brie Carere said.

While international export volumes fell 3%, overall average daily volume rose 4% and revenue per package increased 2%.

FedEx ( FDX ) trades at 11.83 times its projected 12-month forward earnings, compared with UPS's 12.04. But both companies' stocks are trailing the broader market this year amid softening industrial demand and customers favoring cheaper ground shipping.