Good Evening! On Thursday, a decline in technology companies triggered a widespread decline in equities, as concerns arose on Wall Street over the Fed’s aggressive stance and its determination to maintain interest rates at their current level.
All three indexes fell by a significant amount with the Nasdaq sliding 1.82%, the S&P 500 falling 1.64%, and the Dow decreasing 1.08%.
FedEx (FDX) delivered a significant quarterly profit outpacing investors’ expectations. The surprise was attributed to the company’s successful cost-reduction strategies and its ability to attract clients from competitors like UPS and Yellow.
- Revenue: $21.7 Billion vs. $21.74 Billion Expected
- Earnings Per Share: $4.55 vs. $3.71 Expected
So how did FedEx pull this off? The operating income of the company’s ground delivery sector had a significant increase of 59% during the quarter, primarily due to enhancements in cost management and efficiency. Operating income at FedEx Express had a notable 18% rise throughout the quarter which was achieved through strategic measures such as reducing flights, matching workforce levels with volume demands, and implementing adjustments in the US delivery schedule.
What else? FedEx has outlined its intention to spend a substantial sum of $5.7 billion on various initiatives aimed at enhancing efficiency, modernizing its fleet and facilities, and optimizing its network and automation capabilities. The company anticipates generating $1.8 billion in lasting annual cost savings.
WE NEED TO BE FASTER!
According to a report by Bloomberg, Starbucks (SBUX) is now undertaking efforts to enhance the efficiency of its baristas in order to expedite the preparation of its vast array of latte combinations, which is estimated to be over 383 billion distinct variations.
Why the changes? The coffee business is facing challenges in maintaining low customer wait times. A significant number of consumers are flocking to the Starbucks mobile app to place their orders for their morning beverages which makes it easy to make custom orders. On top of that, Starbucks is unable to eliminate the modifications that contribute to slowdowns because… According to the president of Starbucks North America, additional charges generate an annual income of over $1 billion.
Overall picture! More chains are also competing to enhance their order processing capabilities to handle expanded menus and increased sales volume. Popeyes is implementing comprehensive renovations to its kitchen, marking the first major makeover in ten years.