FedEx fell short of earnings expectations in the first quarter and has revised downwards its profit forecasts for 2020.

As we head into 2020, FedEx is facing challenges ahead as it revises its profit outlook for the year, causing its stock value to decline significantly. The company is grappling with various concerns, attributing its struggles to the US-China trade tensions and concerns over a potential recession. FedEx CEO Frederick Smith mentioned in an earnings report, “Our performance is negatively impacted by the global economic conditions worsened by trade tensions and uncertainty in policies.”

FedEx reported that its first-quarter results were affected by increased costs related to service expansion and a shift towards lower-profit services. CFO Alan Graf outlined plans for cost-cutting measures to counterbalance the economic uncertainties. Although the company faces difficulties, FedEx shares have shown a 7% increase year-to-date by the closing of the market on Tuesday.

Additionally, the rise of Amazon might have contributed to FedEx’s recent struggles. Despite initial claims that Amazon was not a competitor, CEO Smith has now acknowledged the opposite.