FedEx Corp. (NYSE:FDX)

The financial data reveals several notable trends in the company's performance and capital efficiency over the six-year period.

Net Operating Profit After Taxes (NOPAT)

NOPAT showed significant volatility, beginning at 2,531 million US dollars in 2020 and sharply increasing to a peak of 7,163 million US dollars in 2021. Subsequently, it declined to around the 4,900 to 5,400 million US dollars range for the years 2022 through 2025, indicating a reduction from the peak but a relatively stable operating profit level in the latter years.

Cost of Capital

The cost of capital fluctuated between 10.27% and 12.34%, with a rising trend from 2020 through 2024, reaching its highest point of 12.34% in 2024 before slightly decreasing to 11.36% in 2025. This indicates increasing capital costs, which could impact investment decisions and profitability assessments.

Invested Capital

Invested capital steadily increased from 57,553 million US dollars in 2020 to 70,379 million US dollars in 2025, representing a cumulative growth in the resources deployed in the business. The trend shows consistent increases year over year, though the growth pace appears to moderate slightly in the final year.

Economic Profit

Economic profit remained negative throughout the period, with values ranging from -3380 million US dollars in 2020 to a smaller loss of -601 million US dollars in 2021. Following 2021, economic profit declined again, reaching a low of -3,716 million US dollars in 2024 before retreating somewhat to -3,080 million US dollars by 2025. The persistent negative economic profit suggests that the company’s returns have not consistently exceeded its cost of capital, indicating challenges in value creation despite the fluctuations in net operating profit and invested capital.

Overall, the data indicates that while the company managed to increase its operating profit significantly in the early period, the improvement was not sustained, and profitability normalized to a lower range in the following years. Rising capital costs and continuous growth in invested capital contributed to negative economic profits, implying that the firm may need to enhance its return on capital or reduce its cost base to generate positive economic value reliably.

Net Income

The net income exhibits a significant increase from 2020 to 2021, rising from 1,286 million US dollars to 5,231 million US dollars. Following this peak, there is a decline in 2022 to 3,826 million US dollars. The values then show a modest upward movement in 2023 and 2024, reaching 4,331 million US dollars, before dipping slightly to 4,092 million US dollars in 2025. This pattern suggests a period of volatility with an initial strong recovery followed by a stabilization phase with minor fluctuations.

Net Operating Profit After Taxes (NOPAT)

NOPAT follows a somewhat parallel trend to net income but with less volatility. It increases notably from 2,531 million US dollars in 2020 to a peak of 7,163 million US dollars in 2021. A decline is observed in 2022 to 5,014 million US dollars, after which it gradually decreases to 4,913 million US dollars by 2025. The downward trend in the last few years indicates some pressure on the core operating profitability despite the initial strong gain.

Provision for Income Taxes

The provision for income taxes shows a notable increase from 383 million USD in 2020 to a peak of 1,443 million USD in 2021, representing a substantial rise. This is followed by a decrease to 1,070 million USD in 2022. Subsequently, the provision increases again to 1,391 million USD in 2023, then slightly rises to 1,505 million USD in 2024, before declining to 1,349 million USD in 2025. The trend indicates volatility with overall growth compared to the initial year, suggesting fluctuating taxable income or changes in tax planning strategies over the period.

Cash Operating Taxes

Cash operating taxes have generally trended upward over the six-year period. Starting at 259 million USD in 2020, the figures increase sharply to 893 million USD in 2021 and continue to rise to 983 million USD in 2022. The upward trajectory continues through 2023 with 1,177 million USD and reaches the highest value of 1,885 million USD in 2024. In 2025, there is a decline to 1,626 million USD. The overall increase suggests higher actual tax payments, which might correlate with increased operating profits or altered tax compliance and payment profiles.

Comparison and Insights

Comparing the two items, cash operating taxes generally rise more consistently than the provision for income taxes, which shows more fluctuations. The significant jump in cash taxes from 2023 to 2024, contrasting with a steady rise in provision in the same period, might indicate timing differences or changes in tax payment schedules. The decline in both provision and cash taxes in 2025 could indicate a reduction in taxable income or enhanced tax efficiency measures.

The financial data over the six-year period presents several noteworthy trends in key capital structure metrics.

Total reported debt & leases

This metric shows a gradual increase from 36,121 million USD in 2020 to a peak of 38,332 million USD in 2023, followed by a slight decrease to 37,416 million USD in 2025. This pattern suggests a strategy of moderate leveraging with a plateauing effect in recent years, potentially reflecting cautious debt management or repayment activities after 2023.

Common stockholders’ investment

There is a consistent and significant upward trajectory in common stockholders’ equity, rising from 18,295 million USD in 2020 to 28,074 million USD in 2025. This increase indicates steady growth in the equity base, possibly driven by retained earnings accumulation or issuance of new stock, thereby strengthening the company’s capital foundation over time.

Invested capital

Invested capital demonstrates a steady upward trend from 57,553 million USD in 2020 to 70,379 million USD in 2025. The growth in invested capital parallels the increase in equity and debt levels, showing expansion in total capital employed by the business. The slower growth rate after 2023 suggests a stabilization in capital investment or asset base expansion.

Overall, the data indicates a balanced growth approach with incremental increases in both debt and equity financing contributing to a higher invested capital base. The stability in debt levels post-2023, combined with continuous growth in shareholders’ equity, may reflect strategic financial management aimed at optimizing capital structure and funding sustainable growth.

Economic Profit

The economic profit exhibits significant fluctuations over the observed period. It starts at a substantial negative value in the earliest year, showing an initial loss of 3,380 million US dollars. There is a marked improvement the following year with the loss considerably reduced to 601 million US dollars. However, this improvement is not sustained, as the economic profit deteriorates again in subsequent years, with losses deepening to 2,468 million US dollars and continuing to decline further, peaking at a loss of 3,716 million US dollars. The most recent data indicate a slight recovery but economic profit remains negative at 3,080 million US dollars. This trend suggests persistent challenges in generating profit above the cost of capital.

Invested Capital

The invested capital demonstrates a steady increasing trend across the years. Starting at 57,553 million US dollars, the capital invested grows each year, reaching 70,379 million US dollars by the most recent period. The growth rate appears consistent but moderate, indicating ongoing investment activities and potentially expanded operations or asset base. This gradual increase in capital investment does not correspond with improvements in economic profit, indicating potential inefficiencies or lower returns on the newly invested capital.

Economic Spread Ratio

The economic spread ratio remains negative throughout the observed years, reflecting a situation where the returns on invested capital are lower than the cost of that capital. There is an initial improvement from -5.87% to -0.94%, signaling a temporary reduction in the deficit between returns and capital costs. However, the ratio worsens again after 2021, fluctuating in the range of approximately -3.71% to -5.29%, with a slight improvement in the latest period to -4.38%. This persistent negative spread reinforces the indication that the company struggles to generate sufficient return on its investments to cover capital costs.

The financial data over the six-year period reveals several notable trends in economic profit, revenue, and economic profit margin.

Economic Profit

The economic profit figures have consistently remained negative throughout the examined periods, indicating that the company did not generate value above its cost of capital in any year. Starting from a significant loss of 3,380 million USD in 2020, there was a notable improvement in 2021 when the loss narrowed considerably to 601 million USD. However, this improvement was short-lived as economic profit deteriorated again in subsequent years, increasing losses to 2,468 million USD in 2022 and further to 2,754 million USD in 2023. The losses worsened again in 2024, reaching 3,716 million USD, before improving moderately to 3,080 million USD in 2025. These fluctuations suggest volatility in the company's ability to generate economic profit, with cyclical losses emerging after a brief period of relative improvement.

Revenue

Revenue displayed a generally positive trajectory from 2020 to 2022, rising from 69,217 million USD in 2020 to a peak of 93,512 million USD in 2022. After reaching this peak, revenue started to decline, falling to 90,155 million USD in 2023 and further decreasing to 87,693 million USD in 2024. A marginal increase is observed in 2025, with revenue standing at 87,926 million USD. Overall, revenue growth over the initial years was significant but was followed by a period of stagnation and slight decline, indicating challenges in maintaining growth momentum.

Economic Profit Margin

The economic profit margin, which measures economic profit relative to revenue, reflects the losses on a percentage basis and follows a pattern consistent with economic profit. In 2020, the margin was deeply negative at -4.88%, improving significantly to -0.72% in 2021, corresponding with the temporary narrowing of losses. From 2022 onwards, the margin deteriorated again, moving to -2.64%, -3.05%, and then to a low of -4.24% in 2024, before a slight improvement to -3.5% in 2025. This pattern highlights persistent economic inefficiency with some minor fluctuations, mirroring the economic profit trends and confirming ongoing challenges in achieving profitability relative to invested capital.

In summary, the company experienced growth in revenue through 2022, followed by a period of revenue decline or stagnation in the subsequent years. Despite the overall increase in revenue over the entire period, economic profit and economic profit margin remained negative, reflecting continuous economic losses. There was a temporary improvement in economic profit metrics in 2021, but losses widened again in the following years, suggesting underlying operational or capital cost issues. These trends point to a need for strategic adjustments to enhance economic profitability and sustain revenue growth.