FedEx is one of the largest courier services in the US. It benefited hugely by the increasing trend of e-commerce which greatly increased the demand for courier packages. With the expansion it benefits not only with larger sales revenue but also Economies of Scale which result in a greater profit percentage. However this might end soon, much to the apprehension of FedEx.
Tech giants Amazon (AMZN) and Google(GOOGL) have been throwing around ideas of new same-day delivery technologies including driverless cars and automated drone shipments. This deeply threatens the postal industry FedEx operates in. This is likely to reshape the logistics industry sometime in the foreseeable future.
At the end of its 4th fiscal quarter of 2014, shares of FedEx shot 6% higher in response to the higher earnings. However this was not distributed evenly in every segment.
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