Good day. And welcome to the FedEx Fourth Quarter Fiscal 2025 Earnings Call. All participants are in listen-only mode. Should you need assistance after today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to FedEx President and CEO, Raj Subramaniam. Please go ahead.

Thank you, operator. Before we begin, I want to take a few minutes to honor someone who meant a great deal to this company, the business community, his beloved family, and to me personally. It feels strange to be here with you all so soon after his sudden passing. And it is difficult to put into words the tremendous loss felt by all who knew Frederick W. Smith. But Fred was a man grounded by a mission. And he would tell us to stay focused on the business and keep marching forward. And so we will do just that. But first, I wanted to share a few thoughts. Fred was more than a business leader. He was a visionary who revolutionized the delivery industry. He was a man who led with integrity and inspired others. His belief in people, his relentless pursuit of excellence, and his commitment to connect people and possibilities built one of the world's most successful companies over the last five decades. And his legacy will be felt for decades to come. On a personal note, I will miss the strategic counsel, impeccable character, and sharp wit. He taught me that leadership is about service and not titles. He challenged me to think bigger, act bolder, and always, always put our people and our customers at the center of everything we do. I feel tremendously fortunate to have spent thirty-four years learning from one of the most brilliant minds in our country's history. Please join me in extending heartfelt condolences to the entire Smith family during this difficult time. As we move forward, we will honor his legacy by continuing to build the company he loved with the same passion and purpose he inspired in us all. Now, consistent with our succession plan, yesterday, the board elected Brad Martin as the chairman of the board of FedEx Corporation. Brad is a highly regarded business leader and strategic thinker who is intimately familiar with the business, having previously served as our vice chairman. With that, I'm going to turn the call over to Jeni Hollander.

Thanks, Raj. Good afternoon, and welcome to FedEx Corporation's fourth quarter earnings conference call. The fourth quarter earnings release and stat book are on our website at investors.fedex.com. This call and the accompanying slides are being streamed from our website. During our Q&A session, callers will be limited to one question to allow us to accommodate all those who would like to participate. Certain statements in this conference call may be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. For additional information on these factors, please refer to our press releases and filings with the SEC. Today's presentation also includes certain non-GAAP financial measures. Please refer to the Investor Relations portion of our website at fedex.com for a reconciliation of the non-GAAP financial measures discussed on this call to the most directly comparable GAAP measures. Joining us on the call today are Raj Subramaniam, President and CEO; Brie Carere, Executive Vice President and Chief Customer Officer; and John Dietrich, Executive Vice President and CFO. And now I will turn the call back over to Raj.

Thank you, Jeni. I want to start by commending our team for their strong efforts and execution. We delivered a solid finish to FY '25 with another quarter of adjusted operating income growth and adjusted operating margin expansion, despite a challenging demand environment. This performance reflects the progress we have made on our strategic transformation, which continues to position FedEx for long-term value creation. In FY 2025, we delivered on our $2.2 billion drive structural cost reduction commitment. This enabled us to achieve our two-year $4 billion drive target compared to the FY '23 baseline. We advanced Network 2.0 in FY '25 as we began optimizing larger, more densely populated markets. We continued to lower our capital intensity, and we returned $4.3 billion in cash to stockholders. We achieved all of this in the face of major headwinds, including the expiration of our US Postal Service contract, two fewer operating days, and volatility and uncertainty related to global trade policies. Against this dynamic backdrop, I'm very proud of our ability to deliver on our targets, adapt our network to changing trade flows, and provide excellent service for our customers. Now turning to our consolidated Q4 results. Revenue was up 1% year over year. We grew our drive savings sequentially and achieved our drive cost reductions target in this quarter. This enabled us to grow adjusted operating income by 8% and expand adjusted operating margin by 60 basis points. At FedEx Corporation, our results demonstrate the operational leverage we have built into our business through Drive. On a 1% increase in revenue, we grew adjusted operating income by 9%. We achieved this result in a weak demand environment, growth largely driven by our deferred services. Our performance demonstrates the flexibility of our network, and I'm confident in the operating results we…

Thank you, Raj. I am proud of how we are helping our customers navigate this challenging period. And I think it's fitting to share that so too is our founder. Just this past Friday, Fred told me how fun it was to watch the team work. And then he saw and felt the momentum building in the business. He was excited about our e-commerce value proposition, the power of our clearance capabilities, and of course, the growth in global airfreight and healthcare. I want to commend the entire organization for our focus on creating vast differentiation and showing up for our customers. Delivering the Purple Promise has served us well for the last fifty years. The last quarter, undoubtedly, it will serve us well in fiscal year 2026. Taking a closer look at our Q4 revenue performance. Consolidated revenue was up 1%, with a 1% increase at Federal Express and continued weakness as expected at FedEx Freight. For both segments, a better than expected May more than offset a softer than expected April. Looking at our volume trends by service. US domestic volumes held up well throughout the quarter. With growth accelerating in late April and May. Our nationwide coverage and our speed advantage are helping us win new, profitable business. We saw 6% volume growth across our US domestic parcel services. From an international perspective, our volume trends closely track global trade headlines. March performance was solid, in line with our expectations. Following the April 2 tariff announcement, customer concerns increased and as a result, volume softened. In early May, upon tariff implementation, China to US volumes deteriorated sharply. And remained weak throughout the rest of the quarter. Our international export revenue was flat, reflecting the tariff-related impact on our Trans-Pacific trade lane. I do want to take a…

Thank you, Brie. And hello, everyone. First, I'd like to share that the culture and extraordinary business that Fred Smith created unconditionally drew me to FedEx. I always greatly respected Fred from my earliest encounters with him in the industry, and I'm grateful and beyond privileged to have worked directly with him these past two years. Now turning to the quarter. I'm very pleased with what we achieved in Q4. This includes the actions we've taken to increase stockholder value, our discipline on CapEx, and the transformation we advanced, all while navigating a very complex environment. Our Q4 results reflect our ability to flex our network, onboard new revenue, and manage costs. On a consolidated basis, we delivered $18.19 in adjusted earnings per share for FY 2025, achieving two consecutive years of earnings growth despite the prolonged freight industry softness, two fewer operating days, the expiration of the US Postal Service contract, and extraordinary weather events. Federal Express also posted higher FY 2025 results year over year despite significant headwinds with adjusted operating income of $151 million on $641 million in revenue growth. This strong flow through to the bottom line demonstrates the powerful leverage inherent in our business. A reality that will become even more apparent when we see a recovery in the industrial economy. While consolidated adjusted operating income declined $121 million, this was due to FedEx Freight results, which continue to be challenged due to the prolonged weakness in the industrial economy. Taking a closer look at consolidated Q4 performance on a year-over-year basis, we delivered an 8% increase in adjusted operating income on a 1% increase in revenue. These results reflect our ability to grow revenue profitably as well as our ongoing commitment to managing our cost structure. Our revenue performance includes recent healthcare wins, which…

We will now begin the question and answer session. The first question is from Daniel Imbro with Stephens. Please go ahead.

Yes. Hey, good evening, everybody. Thank you for taking our questions. Raj, I guess I want to start on the Network 2.0 savings, and maybe John, you can help chime in here too. But Raj, you mentioned ramping the pace of them through the fourth quarter and kind of into the first quarter. I guess I think John said $200 million of Drive and Network 2.0 in the first quarter, but can you talk about the shape of how you see that $1 billion developing through this year just given the pace of the rollout? Then John, digging into that $200 million, it looks like you got $700 million of drive savings in the fourth quarter. You just flat line that? It should be a few hundred million of benefit in the first quarter. So are there any offsets as to why those drive savings aren't larger in the first half of the year? That'd be great. Thanks.

So thank you, Daniel. I'll take that. And with regard, I'll start kind of in reverse order. Make sure I capture all your questions. Yeah. With regard to the $1 billion, we're anticipating $200 million of that in the first quarter, as we stated. And as I said in my remarks, we see a ramping up of that through the year. And that will include not only Drive but Network 2.0 savings. And we've been clear that with regard to financial returns on Network 2.0, we're really not going to see material impact of that until the end of fiscal year 2027. So, with regard to your comment on the Q4 results, you're right. We achieved our north of $600 million, I think it was $650 million roughly of drive benefit, which we committed to at the beginning of the year. We ramped up sequentially through the year and achieved our $4 billion for the two years and our $2.2 billion for FY 2025. So, drive is going to be something we're going to continue to focus on. We're going to continue to feed the pipeline. It runs across and is part of our DNA here. It's a way of doing business for us. And the way I've described it to some, it's really a journey, not a destination. So we're gonna keep feeding it, but that's our current outlook. The next question is from Brian Ossenbeck with JPMorgan. Please go ahead.

Hey, good evening. Thanks for taking the questions. Brie, I wanted to talk about the competitive dynamic in pricing and your commentary made. I think in the past you said competition is still pretty challenging and at times increasing, but it sounded like the pricing environment is actually improving. So you can give us a sense as to what changed, and then also how you're trying to balance the extra capacity in that work with some of the improving utilization, with some of these pricing initiatives, fuel surcharges, and other over-dimensional hard to handle that we're seeing at the market. Thank you.

Thanks, Brian. As I did mention in my prepared remarks, we do see improvement in the pricing environment, which is encouraging. I do want to note that this is compounded with our team's focus on revenue quality, and, you know, I could not be more proud of the team's execution. As you saw over the last quarter, they pulled multiple pricing levers. We continue to work on our large package strategy because we get a higher price relative to market because this is a very differentiated capability. We've got great coverage in rural. We're continuing to look at opportunities to monetize that and get paid for the differentiated value. Then, of course, we did make a significant change in our fuel surcharge of 2%. So we are pleased with the market, but we're equally pleased with the team's ability to execute. I think a great proof point of this is in Q4 when you look at the domestic yield for the quarter, you will see that the overall domestic parcel yield is still pressured. But what you can't see is that for home delivery and ground commercial, we had our best year-over-year yield improvement for those two really important products in Q4. So again, just a great proof point of how well the team is executing. Thanks for the question.

The next question is from Chris Wetherbee with Wells Fargo. Please go ahead.

Yes. Hey, thanks. Good evening, guys. Maybe I could ask about the guidance and thinking a little bit about what shows up in fiscal 1Q that may not as we go through the rest of the year. The $120 million from the post office, I think that's easy to understand. $170 million on the international side, I guess, you maybe help us understand and break it down a little bit between maybe de minimis or what we're seeing and so China to the US or relative to maybe other countries to the US? And then how does that play out? What do we need to see to sort of change that dynamic into the next several quarters of the year? In other words, does it stick around for a while? Is there a certain event that you're looking for to give you some more comfort that that's maybe not going to be around for the rest of the year?

I think I'll take that one. So, obviously, the trade environment is the primary reason that we are focused on Q1 versus a range for the entire year. We just simply cannot predict how that's going to play out. We built the range, as John talked about, based on the current trade and tariff environment. What we do anticipate is that from a year-over-year perspective, we will have pressure on the transpacific lane. And so when we talked about the headwind on tariffs, the vast majority of that is impact from China to the US. And within that, the vast majority is the impact of de minimis.

I think what I'd add to that, Brie, is, you know, for other points in the globe outside of China, you know, there's still some trade negotiations going on there as well, which we don't yet know the outcome of. So I think have that additional color.

And let me just say this much. I think over the next thirty to sixty days, the trade environment will change. And so we'll see, you know, how that evolves, and it was very dynamic. And at that point, we'll be able to be more prescriptive. Thank you.

The next question is from Richa Harnain with Deutsche Bank. Please go ahead.

Hey, everyone. Thanks, thanks for the question. So I know and I appreciate, you know, a lot of challenges and uncertainties out there. It's you all said, hence no full-year guide. But just as we think about the cadence of the year in terms of some of the discrete tailwinds and headwinds related to cost savings and the like, perhaps you can help us a little bit more. So recently, you know, Q1 has represented something like 20% of fiscal year EPS result. John, you mentioned some of those things in the bridge. Like the USPS will be a headwind early part of the year that goes away, and that'll influence normal seasonality. So should we assume Q1 have a lower weight than usual, especially as, you know, these structural cost savings ramp up through the year?

Yes. Thanks, Richa. Yes, I think that's a fair assumption there. When you look at the particular headwind with regard to the postal service contract, that we're going to lap in subsequent quarters. So you said, we're only providing first-quarter outlook at this time. And that US Postal Service headwind will be a factor. You know, as a reminder, we'll lap that and we can as we continue to build out on our expected billion-dollar and transformation benefit throughout FY 2026 that could have an impact depending on what happens on the revenue environment. Particularly in US domestic.

The next question is from Jason Seidl with TD Cowen. Please go ahead.

Thank you, operator, and condolences to the Smith family. The transportation sector definitely lost a giant. Wanted to just parse out between sort of B2B and consumer. It sounded like a lot of the pressure was on the B2B side still. Maybe you could talk a little bit about the consumer. And I think you mentioned May was better than expected. What were you guys seeing so far month-to-date in June?

Hey, Jason. Thank you for your comments. And we'll pass on to the family.

Thank you for the question. So from a B2B perspective, yes, you're absolutely right. We have not seen an improvement in the industrial economy, and that's certainly pressuring both our FedEx Ground commercial but also our base at Express and certainly the FedEx Freight division. So we have not seen improvement there. Obviously, when we see improvement, we're ready to capture that. From a consumer perspective, when we saw the May increase, obviously, we spent a lot of time looking at the data. There is no one indication that we can point to that says that there was a consumer pull forward. What I can tell you is onboarding within our own pipeline was stronger in May, and that was the largest driver. Whether or not there is consumer pull forward is TBD, which is why we gave you the range that we did from a revenue perspective.

Let me just make one more point here. I think, on Q4, we noticed that operating leverage that we have with the volume increases primarily driven by B2C. So, obviously, that's the hard work that we have done over the last three years. It gives us that operating leverage. And, you know, when the B2B starts to grow again, there's significant opportunity here.

The next question is from Jon Chappell with Evercore ISI. Please go ahead.

Thank you. Good afternoon and our condolences as well to the Smith family and the FedEx family. It struck me with Raj's comments about cutting Asia to US capacity by 35% in May and exiting May down 20%. We think about this tariff impact, how much of that $170 million is at least as it relates to the first quarter? Is strictly revenue and how much of it is cost that could be fleeting, so to speak, around the flex of your network.

I'll say this much. I think the first of all, because of the implementation of Tricolor, our network has become incredibly more flexible. What we have accomplished in May would not have been possible without the implementation of Tricolor. I'll leave it to John to parse the revenue and the cost out of the question.

Yeah. Thanks, Raj. I think it's a fluid situation in that in areas where we may be contracting in terms of flights and so forth, we're redirecting that to where the demand is going to. So it's not a straight takeout of the cost and we're going to continue to adjust to the demand flows. So we're gonna be watching that closely. We're gonna be watching our assets closely. So I think it's fair to say I'm not gonna parse out the $170 million in top line and bottom line, but I will say we're watching it closely, it's an appropriate estimate of what we're seeing right now.

The next question is from Conor Cunningham with Melius Research. Please go ahead.

Hi, everyone. Thank you. Just going back to Network 2.0, you mentioned, I think, 2.5 million packages that are going through the new network now or by June, I should say. Can you just talk about the margin contribution of those? Are they coming in as you would expect? And you've downplayed the potential of those being more of an FY 2027. I'm just trying to understand why there is that lagging gap. Is there, like, a lag period between those needing to go up to where you would think from a margin contribution? Thank you.

Hi, Conor. Thank you for the question. From a Network 2.0, I cannot emphasize enough how pleased we are with Scott Ray and the execution that this team has demonstrated. When we looked at the original case from a P&D perspective, the majority of the savings are in the pickup and delivery reduction, and we are hitting those targets. So we're very pleased with that. As we think about when we want the flow through or expect the flow through from Network 2.0, it is important that it is gonna follow. Because when we go into a market, we have cost to implement the change in service and to make sure that we've got the right contingency so we have no revenue breakage. So that's why you're seeing a lag. We are on track as we talked about for FY '27 and the $2 billion. So we feel really good about this program.

The next question is from Jordan Alliger with Goldman Sachs. Please go ahead.

Yes, hi. And I want to offer my condolences to the Smith family as well. Truly visionary. So sort of a secular question. And if you have perhaps some of your perspective on the change in global trade patterns due to tariffs? I know it's early, but specifically for less than truckload potential to domestic manufacturing. And then from more of a global perspective, indeed, do you expect to see an emergence of a China plus one and even a plus two strategy from a logistics perspective? Thanks.

Thank you, Jordan. I appreciate your condolences as well. The patterns are changing as we speak. And clearly, we are seeing growth from Southeast Asia, for example, Vietnam. We launched this direct flight or redirected this flight now, going from Singapore directly to the United States, which is a significant value proposition improvement for that market. We're seeing, you know, we're looking at Asia to Europe as an opportunity. I was in the Miami headquarters for Latin America. Inbound markets are growing. So and this pattern and markets like India are growing substantially as well. So the patterns are changing as we speak. But the good news for FedEx is that we have built out this global network. This is where we get to flex our scale because we don't have to do much different because we are already there in these markets. We have to be careful making sure that, you know, that the capacity is right in markets, but it's, you know, we can move faster than how manufacturers can move, and we get the feedback of what's happening on the ground from the bottom up as you see, we are the referendum on global supply chains every single day. So it's something that we are working with. The second part of it is the fact that over the last many, many years, for every country to every other country, for every commodity, we have the data. And not only do we have the data, we have engineered it and created that digital twin. So then we are able to apply the most modern technology to be able to create platform solutions for our customers in this very complex environment. And so whether it's importers, whether it's exporters, whether it's brokers, whether it's regulators, so, you know, yes, complexity is increasing. The environment is changing. But here's where we get to flex our scale. Thank you.

Raj, I don't have very much to add. I think you covered that comprehensively. I think post-COVID, we already saw a focus on regionalizing supply chains. You know, I think there was that impetus to diversify, and I think that there's gonna be a continuation too. I'm really pleased with the commercial team and their execution in developing markets. You know, India comes to mind right now. We have a relatively small revenue base, but they are really doing well from a profitable growth perspective. We can see the same thing. We've got great momentum from Asia into Latin America. So I think the team is actually executing really well. I think the other thing that's critically important is Jill and the team have put an extraordinary program in place that incents the Chinese sales team to notify their counterparts around the world. So to Raj's point, from a bottoms-up, they make a sales call in China and they have a customer there that is diversifying, we know we are connected, and so we have the right conversations with their counterpart in Mexico or Vietnam, Malaysia, wherever else they are moving or thinking about shifting their demand. So I think we are really well prepared for any change in the market.

The next question is from Bascome Majors with Susquehanna. Please go ahead.

Yes. Thanks for taking my question. John, when you walk through the cash flow, I know we'll see this when we get the 10-Ks later, but how much CapEx is in the freight segment for last year? And how is that anticipated to trend in the budget for this year in the $4.5 billion that you talked about?

Yeah. Bascome, I may have to get back to you on that one. I don't have that number right at my fingertips. And if you just give me a minute, I'll come back to revisit that answer.

The next question is from Scott Group with Wolfe Research. Please go ahead.

Before I do, Scott, hey, Bascome, I do have that number. It's $437 million. So apologize for that slight delay. Thank you. Hey, Scott.

All right. Thanks. And I'll echo condolences as well to Fred's family and the FedEx team. John, I guess my questions are for you. Can you clarify how much of the $1 billion this year is Drive versus Network 2.0? And then I guess, I understand we don't have a full-year guide, but what's your degree of confidence that we'll see full-year earnings growth this year? I'm not asking for a range, but just directionally do you think we're set up to grow earnings this year?

So thanks, Scott. So on your first question of the $1 billion, we're not really breaking out how much of that is Drive and Network 2.0. I expect we're gonna have puts and takes on both fronts. And what we are committed to is the billion dollars. And, you know, when you look at our prior goals, we put it out there and we achieve them. So I'm looking forward to achieving this billion and as I said before, keeping to feed the pipeline. So, you know, with regard to our guidance, you know, I think it's dependent on where the demand environment goes to. You know, we're gonna be focusing on those things within our control. We've got a handle on those things within our control. And depending on what happens in the macro environment will depend on where we fall within the range. So we put a range out there for a reason, and we believe if there are favorable factors, we're gonna be on the top end of the range. And if we're under pressure, we'll be on the lower end of the range. So I think a good way to think about it is that the zero flat revenue, we're at the lower end of the range at the $3.40 at 1%. We'll be at the $3.70, and you know, at the 2%, we'll get about $4. So obviously, we're gonna shoot for that $4 and then some.

And, Scott, let me just talk a little bit more broadly. I think if you look back at the last three years, we have reduced our total cost in absolute terms by $4 billion plus dollars. And this is in a period of inflation. That provides us a lot of leverage. And we can see the opportunities now, you know, in your own words, the jaws of the crocodile, the bar potentially open. I think we have the even with B2C volume increasing, we are seeing now significant operating leverage. And at some point, the industrial economy will turn. So we have opportunities on both sides, on one on the revenue side, you know, we'll have to deal with an uncertain and dynamic economy, but then and then secondly, the operating leverage we created because of our cost structure will help us going forward.

The next question is from Brandon Oglenski with Barclays. Please go ahead.

Good afternoon, everyone, and obviously, lost a great business visionary and a patriot over the weekend. So condolences to Fred's family, friends, and colleagues. But, Raj, you know, I think over the years, what we've come to know is we would get Fred's insight into global policies. We know over the years, he was a big proponent of free trade. I guess, can you give us some insight into his, you know, past guidance and maybe recent guidance on how to navigate higher US barriers that maybe are here to stay? How do you navigate the FedEx network in that scenario? I really appreciate it.

Thank you, Brandon. We're all laughing here about, you know, how in the world I'm gonna answer that question. But first of all, thank you for your condolences. Yes. Fred was absolutely sitting on the side of free trade, but as he constantly reminded me that we don't make calls and we get to, you know, implement the policy sometimes. And that's what we're doing. And I think the point that I would make to you is it's very, very difficult to predict what's gonna happen over the next thirty to sixty days or even further. And it's a dynamic environment. So we just have to live with that. What I would say is the point I stressed before. The scale of FedEx comes into play in these kinds of situations. Both on the physical side and the digital side. As the complexity and the friction increases, and the trade flow patterns change, you know, we have the advantage from the perspective that we have the scale to execute for our customers. So that's what we'll focus on and, I'll stay away from the prediction game right now.

And the final question today comes from Tom Wadewitz with UBS. Please go ahead.

Yes. Good afternoon. And yeah, look, my condolences as well. I know it's gotta be painful, the loss of your founder. So, you know, condolences also to the FedEx family. The question I have, I have a bit of difficulty kinda translating I guess, the information you give us on the Network 2.0. In terms of, like, you know, is it just is it tracking or you know, I think in terms of, you know, terminal closures maybe as being a better read as opposed to terminal conversions, just a better read on cost savings. So I know you're gonna give us some updates in the future, but just any thoughts. Do you feel like you're kind of ahead of the game on how that's going? And or just how would you how would you think about it in terms of how it's progressing versus the program that you've had? You know, kinda had the same targets out there for a while. And are there any components within that just like you know, instead of terminals that are up and running on 2.0, how many terminals have actually been or stations have actually been shut down at this point? Thank you.

Thanks, Tom. I think the best way to describe it is that we're on track. Look, this was a long game exercise and initiative. And one of the things that is paramount is that we, as Brie mentioned before, preserve our customer service and not only maintain but enhance our service. We're seeing good progress on both the reliability side as well as the financial side for those locations we have transitioned. We're seeing the 10% improvement on our PUD. So we're learning along the way too, and we're adapting along the way. So I think it's fair to say we're on track. We've put our targets out there in terms of the $2 billion with Network 2.0 and as part of OneFedEx. I view those as going hand in hand. We look forward to updating you on. But I'd say it's on track.

Yeah. And thank you, Tom. Again, I think I would just say, first of all, I'm very pleased with how we're progressing here. As of at the end of FY 2025, we've closed 100 stations and integrated 290 stations under the Network 2.0 model. And we expect to by the end of this program, expect to remove roughly 30% of our surface facilities. So I was just out there on the West Coast where we just implemented the Network 2.0. I was just so delighted to see how well that they have done, the morale of the team, how the team is working together. So, yes, we're you know, this is a journey for us, but I think so far, so good, Tom. Thank you.

This concludes our question and answer session. I would like to turn the conference back over to Raj Subramaniam for any closing remarks.

Well, in closing, I would like to extend a sincere thank you for the outpouring of support received as we mourn Fred's loss. The words of support, anecdotes, thoughts, prayers that have poured in over the last seventy-two hours are a testament to the life and legacy he leaves behind. I'll end with a story that embodies who Fred was as a person, and what he stood for. As the family gathered over the weekend, his son, Cannon, noticed an engraving on the back of Fred's watch. The same watch he wore for many, many years. As he shook thousands of hands from heads of state and business leaders to military veterans and countless FedEx team members. And engraved on the back of this well-worn, unassuming timepiece, is the phrase "waste not a moment." Let me say that again. Waste not a moment. We will carry that sentiment with us as we honor Fred's memory and lead FedEx through the next chapter. Thank you very much.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.