Why Is Logistics Giant FedEx's Stock Trading Lower Today?

Author: Shivani Kumaresan | July 19, 2024 11:33am

FedEx Corp. (NYSE:FDX) shares are trading lower after the company experienced disruptions across its networks due to a global IT outage caused by a software vendor on Friday.

This widespread tech outage has affected multiple industries, including airlines, broadcasters, banking, and healthcare, creating substantial operational challenges.

It remains unclear if FedEx's network disruptions are linked to the outages at Microsoft Corp (NASDAQ:MSFT) and cybersecurity firm CrowdStrike Holdings Inc (NASDAQ:CRWD), reported Reuters.

Related: Windows PCs Crash Worldwide With Users Experiencing Blue Screen Of Death Issue, CrowdStrike Confirms Defect: ‘Fix Has Been Deployed’ (UPDATED)

FedEx said it “has activated contingency plans to mitigate impacts from a global IT outage experienced by a third party software vendor. However, potential delays are possible for package deliveries with a commitment of July 19, 2024.”

Also Read: Is FedEx Spying On You? Civil Rights Analyst Calls AI Surveillance Program ‘Profoundly Disconcerting’

FedEx is not the only logistics company facing challenges. Peer company United Parcel Service, Inc. (NYSE:UPS) also warned of possible delivery delays, citing contingency plans to address the issues, the report added.

Additionally, railroad operator Union Pacific Corp. (NYSE:UNP) reported that the CrowdStrike software outage had “varying levels of impact” across its network, though backup protocols have assisted in maintaining communication with teams and dispatchers.

The global tech outage on Friday disrupted operations in various sectors, causing airlines to halt flights, broadcasters to go off-air, and impacting banking and healthcare systems.

Also See: Microsoft Outage Wreaks Havoc On World As 911, International Airlines, Banks And Airport Services Disrupted (UPDATED)

FedEx stock has gained about 17% in the last 12 months. Investors can gain exposure to the stock via IShares U.S. Transportation ETF (BATS:IYT) and SPDR S&P Transportation ETF (NYSE:XTN).

Price Action: FDX shares are trading lower by 0.54% at $304.95 at last check Friday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Photo via Shutterstock

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Posted In: CRWD FDX IYT MSFT UNP UPS XTN