FedEx CEO says he expects the economy to enter a ‘global recession’
FedEx CEO Raj Subramaniam told CNBC’s Jim Cramer Thursday that he believes a recession is imminent for the global economy.
“I think so. But you know, these numbers, they don’t portend very well,” Subramaniam said in response to Kramer’s question whether the economy was “in a global recession.”
The CEO’s pessimism came after FedEx missed estimates for revenue and profit in the first quarter. The company also withdrew its guidance for the whole year.
FedEx shares fell 15% in extended trading Thursday.
“I am very disappointed with the results we have just announced here, and the headline is the overall situation we are facing,” Subramaniam said in an interview with Mad Money.
The CEO, who took over the role earlier this year, said weak global shipments had led to FedEx’s disappointing results. He said that while the company expected demand to increase after factories were closed in China due to Covid reopening, it had actually declined.
Week after week, it happened,” Subramaniam said.
The CEO also said the volume loss is widespread, and that the company has seen a weekly decline since around Investor Day in June.
“We’re seeing volume declines in every sector around the world and so you know, we’ve just started the second quarter,” he said. “The weekly numbers don’t look good, so we’re assuming at this point the economic conditions aren’t really good.”
He later added, “We are a reflection of everyone else’s business, especially the world’s high-value economy.”