FedEx CEO Raj Subramaniam told CNBC’s Jim Cramer on Thursday that he believes the global economy is headed for a recession.
“I guess so. But you know, those numbers don’t bode well,” Subramaniam replied to Cramer’s question about whether the economy was going “into a global recession.”
The CEO’s pessimism came after FedEx missed estimates for first-quarter revenue and earnings. The company also withdrew its full-year guidance.
Shares of FedEx fell 15% in extended trading on Thursday.
“I’m very disappointed with the results we just announced here and you know the headline really is the macro situation we’re facing,” Subramaniam said in an interview with Mad Money.
The chief executive, who took the position earlier this year, said weaker global shipping volumes led to FedEx’s disappointing results. While the company expected demand to pick up after factories in China reopened due to Covid, it actually fell, he said.
“Week and week and week, it came down,” Subramaniam said.
The chief executive also said that the drop in volume was widespread and that the company had posted weekly declines since around its investor day in June.
“We’re seeing this volume drop in every segment around the world, and as you know, we just started our second quarter,” he said. “Weekly numbers aren’t looking too good, so at this point we’re just assuming the economic environment isn’t really good.”
“We mirror everyone else’s business, especially the high-quality economy of the world,” he later added.
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