FedEx said Tuesday that its quarterly earnings and sales fell from a year ago and warned of ongoing weakened demand, but said its “aggressive” cost-cutting measures were softening the blow.

The package delivery giant’s net income fell to $788 million in the three months ended Nov. 30 from $1.04 billion a year earlier. Sales fell to $22.8 billion in the three months, down from $23.5 billion a year earlier, falling short of estimates.

Adjusting for one-time items, FedEx posted per share earnings of $3.18, ahead of analyst estimates but below the $4.83 a share it reported during the same period of last year.

Here’s how FedEx performed in the period based on Refinitiv consensus estimates:

• Earnings per share: $3.18 adjusted vs. $2.82 expected
• Revenue: $22.8 billion vs. $23.74 billion expected

FedEx shares were down more than 1% in after-hours trading following its report.

In September, FedEx announced cost-cutting measures that included parking planes and closing some offices. It also raised package-delivery rates. The company at the time withdrew guidance, and CEO Raj Subramaniam said he expects the economy to enter a “worldwide recession.” 

“Our teams have an unwavering focus on rapidly implementing cost savings to improve profitability,” FedEx’s CFO Michael Lenz said in an earnings release. “As we look to the second half of our fiscal year, we are accelerating our progress on cost actions, helping to offset continued global volume softness.”

FedEx shares are down about 36% for the year as of Tuesday’s close, compared with the S&P 500’s roughly 20% decline.

FedEx executives will hold a call with analysts to discuss results at 5:30 p.m. ET. They are likely to face questions about the global economy, holiday travel demand and reliability, and its costs for the coming year.

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