You've probably seen a lot of FedEx trucks in your neighborhood during the past six months. Heck, you've probably been getting a lot more FedEx deliveries if you've been stuck at home during the coronavirus outbreak. So it's no wonder that FedEx just reported strong jumps in sales and earnings for the first quarter.
Shares of FedEx (FDX) rose more than 7% on the news Wednesday. The stock is up nearly 70% this year, and not far from an all-time high. FedEx rival UPS (UPS) gained nearly 2% following the FedEx results and is now up about 40% in 2020.
FedEx is thriving even without Amazon. Last year, FedEx decided to not renew ground and air cargo contracts with Amazon (AMZN) as the e-commerce giant has ramped up its own delivery and logistics network.
Without mentioning Amazon by name, FedEx CFO Alan Graf, who plans to retire at the end of the year, said during a conference call with analysts that the company "made a strategic decision to go all in on e-commerce."
"We moved away from a large customer to focus on the broader market." The move appears to be working," Grad added.
FedEx chief marketing officer Brie Carere said during the call that "in the US, spending that would normally have gone into services has shifted towards goods" and that "e-commerce is booming at holiday levels" because of Covid-19.
But FedEx executives also conceded that the economy won't truly return to normal until there is a coronavirus vaccine. CEO Fred Smith said "detailed planning is underway at FedEx to distribute vaccines at scale worldwide once approved."