(Reuters) - FedEx's ( FDX ) shares fell sharply after the parcel delivery firm cut its fiscal 2025 forecasts, adding to worries about the health of the U.S. industrial economy against the backdrop of the Trump administration's sweeping tariffs on trading partners.

The company's stock was down 6% before the bell on Friday after CEO Raj Subramaniam said the day before that FedEx ( FDX ) was "navigating a very challenging operating environment."

Rival UPS' shares also fell 1.3% premarket.

U.S. President Donald Trump's import tariffs have created uncertainty for businesses, prompting them to be more cautious with their spending as they navigate an uncertain economic landscape.

Both FedEx ( FDX ) and UPS are viewed as barometers for the global economy due to their involvement with a wide range of industries.

Shipments from companies that produce goods used in manufacturing drive substantial cargo volumes and high-margin deliveries for the delivery firms.

Analysts and economists have said that Trump's import levies could trigger a recession and a trade war, further affecting transportation and delivery demand.

"FedEx's ( FDX ) Q3 print and full-year forecast cut will likely exacerbate concerns of structural pressures in the parcel business," Morgan Stanley said, adding that it may even overwhelm the company's cost-cutting program.

FedEx ( FDX ) has been reducing costs as demand for lower-margin e-commerce deliveries from companies such as Temu and Shein outpaces higher-margin business-to-business shipments.

"Management noted weakness in the industrial economy and, while macro is a factor, we believe structural forces are a far bigger headwind than the market thinks," Morgan Stanley added.

Memphis-based FedEx ( FDX ) lowered its fiscal 2025 profit forecast on Thursday and now expects adjusted earnings per share between $18.00 and $18.60, compared with its previous outlook of $19 to $20.

The company also expects revenue for the 12 months ending May to be flat to slightly down year-on-year, versus its earlier forecast for it to be about flat.