Good morning, ladies and gentlemen, and welcome to the annual stockholders meeting of FedEx Corporation. I am Brad Martin, chairman of the board of FedEx Corporation, and we appreciate the interest of the stockholders who have joined the meeting, and thank you for being with us today. With me are Gina Adams, our Executive Vice President, General Counsel, and Corporate Secretary, who will act as secretary of this meeting, and Raj Subramaniam, our President and CEO, as well as a member of our board. Also in attendance are the following other members of the board of directors: Mark Edmunds, Marvin Ellison, Tricia Griffith, Nancy Norton, Fred Perpall, Joshua Ramo, Susan Schwab, Richard Smith, and Paul Walsh. Representatives of Ernst & Young are also in attendance.
The agenda and the annual meeting guidelines are posted on the meeting website, and the meeting will be conducted in accordance with the agenda and those guidelines. I will now call the meeting to order. Ms. Adams will report on the giving of notice for the meeting and the presence of a quorum.
Mr. Chairman, I have received an affidavit of a representative of Broadridge Investor Communication Solutions Inc., which states that on August 17th, 2026, a notice regarding the internet availability of proxy materials or the notice of annual meeting, the proxy statement, the proxy, the 2026 annual report, and a postage prepaid return envelope were mailed to the stockholders of record as of August 3rd, 2026. A representative of Broadridge will serve as Inspector of Election today. A tabulation of the proxies received from stockholders indicates that a majority of the shares outstanding on the record date are represented at this meeting and a quorum is present.
Thank you, Gina. A copy of the affidavit will be filed with the records of this meeting. The polls for each proposal are now open at 8:02 A.M. Central Time on September 28, 2026. The proposals to be considered today are listed on the agenda and in the proxy materials previously provided. If you have already submitted your proxy, your shares will be voted accordingly. If there is any stockholder who has not yet voted and wishes to do so, please do so by clicking on the voting button on the virtual meeting portal and follow the instructions there.
We have six proposals to vote on this morning. After all of the proposals have been presented, we will answer any questions that have been submitted related to the proposals. Questions not directly related to the proposals will be answered at the conclusion of the meeting in accordance with the annual meeting guidelines.
The first proposal is the election of the 11 director nominees named in the proxy statement to serve as a director until the 2027 annual meeting and until his or her successor is duly elected and qualified. The next item is the proposal to approve, on a non-binding basis, an advisory resolution approving the compensation paid to FedEx's named executive officers as disclosed in the proxy statement. The third proposal is the ratification of the appointment of Ernst & Young LLP as the independent registered public accounting firm of the company for the transition period June 1st, 2026, through December 31st, 2026. The fourth proposal is a stockholder proposal regarding an independent board chair. The proponent will have three minutes to present this proposal. I'll now ask the operator to open the line for Matt Prescott, who on behalf of The Accountability Board Inc., will present the proposal.
Mr. Prescott, you have three minutes. Please proceed.
Thank you so much, and I'm happy to keep this pretty brief for the sake of everybody's time today. We think the proposal is fairly self-explanatory, speaks for itself. The only thing I really want to add is that both Institutional Shareholder Services and Glass Lewis are both recommending a vote in favor of the proposal. For any questions about it, we would refer everybody to the proxy itself. Finally, just want to thank the board for its consideration. Obviously, we didn't end up seeing eye to eye on the proposal, but we appreciate the consideration nonetheless. Thank you.
Thank you, Mr. Prescott. We certainly appreciate your perspective as well. The fifth proposal is a stockholder proposal regarding a lower threshold to call a special meeting. The proponent will have three minutes to present this proposal. I'll now ask the operator to open the line for John Chevedden, who will present the proposal. Mr. Chevedden, you have three minutes. Please proceed.
Hello, this is John Chevedden, Proposal 5, improve shareholder ability to call for a special shareholder meeting. Shareholders ask the board of directors to take the necessary steps to amend the governing documents to give the owners of a combined 10% of outstanding common stock the power to call a special shareholder meeting. Such a special shareholder meeting can be an easy-to-convene online shareholder meeting. The special shareholder meeting proposal 5 deserves shareholder votes, especially after the unsupported FedEx statement next to this proposal. FedEx claims that FedEx shareholders have a meaningful right to call for a special shareholder meeting, which is totally unsupported by FedEx.
FedEx joins the long list of more than 100 companies that failed to give even one example of a special shareholder meeting ever taking place at a company worth at least $1 billion that has a right to call for a special shareholder meeting similar to the so-called current FedEx right. The FedEx right is not meaningful if there's never been an instance of shareholders making use of a right similar to it at any company anywhere. FedEx says that its shareholders should simply be satisfied with its engagement program that brags about such things as shareholder engagement at an annual meeting that's not even an in-person annual meeting and is scheduled at 6:00 A.M. for West Coast shareholders. FedEx says that shareholders should simply be satisfied with its current governance practices, which are totally unremarkable. Please vote for Proposal 5 to improve FedEx shareholder rights.
Thank you, Mr. Chevedden. Proposal Number 6 is a stockholder proposal regarding a report on risks related to the distribution of abortion drugs. The proponent will have three minutes to present this proposal. I'll now ask the operator to open the line for Pia de Solenni, who will present the proposal submitted by IWP Capital, LLC on behalf of the Catholic Diocese of Fort Worth. Ms. de Solenni, you have three minutes. Please proceed.
Good morning, and thank you. My name is Pia de Solenni. I am the vice president of corporate engagement for IWP Capital. As you heard, we represent the Catholic Diocese of Fort Worth, which filed proposal 6, the report on risks related to distributing abortion drugs. As one of the largest logistic companies in the U.S., FedEx delivers millions of packages to homes, pharmacies, and healthcare providers. FedEx is a critical link in the national supply chain. The company plays a central role in the transportation of regulated, controlled, and high-risk items. Of course, this role has its limits. On FedEx's prohibited items page, for example, the company lists over 15 items and categories: switchblade knives, seditious and treasonable matter, and Kinder Surprise eggs, which FedEx's website helpfully describes as Easter chocolate eggs with surprise. One item is missing from FedEx's list, mail-order abortion drugs.
The Comstock Act prohibits the use of any express company or common carrier to transport any drug or medicine designed, adapted, or intended for producing abortion. This outlaws shipping abortion drugs like mifepristone and could apply anywhere in the supply chain. More than 20 states have enacted laws restricting or prohibiting abortion-inducing drugs within their borders. Some states have regulations directly prohibiting the prescription, delivery, and distribution of abortion drugs. Together, these laws make clear that in many states, delivering mail-order abortion drugs such as mifepristone is illegal. Meanwhile, online pharmacies openly advertise that they use FedEx to ship abortion pills to states where these pills are restricted. Under those circumstances, FedEx should be aware of the package's contents when accepting shipments from these businesses. Additionally, there are only three companies that manufacture mifepristone for use in abortion. Over the past year, IWP has raised this concern to FedEx.
We do not want to see FedEx complicit in decisions that severely harm women and terminate the lives of their unborn children. As a FedEx investor, the diocese has no desire to participate in the wide distribution of abortion pills, nor does the diocese have any desire to see its investment pay for the defense against future legal enforcement actions against FedEx on this issue. Our other clients concur. In its statement of opposition to proposal six, the board cites its commitment to compliance with applicable laws and regulations. This promise falls flat, however, unless FedEx is prepared to comply with all state laws, including those that prohibit the shipment and delivery of abortifacients. If FedEx can prohibit Kinder Surprise eggs, certainly it can prohibit abortion pills that do irreparable harm to women and children. Thank you for your time and consideration.
Thank you, Ms. de Solenni. If there are no questions, we do have one question regarding the proposals.
We do have a question with regard to proposal six. FedEx is a transportation and logistics provider, not a manufacturer, distributor, prescriber, or dispenser of pharmaceutical products. Our role is to provide transportation services in accordance with applicable laws, regulations, and customer agreements. We transport a wide variety of regulated products and maintain processes designed to support legal and regulatory compliance. The board has considered the proposal and believes existing risk management and compliance processes are appropriate for managing associated risks. The company continually monitors developments that could affect its operations and responds as necessary. FedEx believes the proposal does not identify a gap in oversight that would warrant a separate report. Thank you.
Thank you, Ms. Adams. Is there any stockholder present who has not yet voted and wishes to do so? If so, please vote now on the meeting website. Polls will close in one minute. I hereby declare the polls closed at 8:12 A.M. Central Time on September 28th, 2026. Inspector Election has provided the following preliminary voting results for each of the proposals. With respect to Proposal 1, each of the 11 director nominees has been duly elected to serve as a director of the company. With respect to Proposal 2, the advisory resolution on named executive officer compensation has been approved. With respect to Proposal 3, the appointment of Ernst & Young LLP as the independent registered public accounting firm of the company for the transition period from June 1, 2026 through December 31, 2026 has been ratified.
With respect to Proposals 4 through 6, none of those stockholder proposals has been approved. Please note that the voting results just announced are preliminary. Final results will be included in a Form 8-K filed with the Securities and Exchange Commission following this meeting. Now, ladies and gentlemen, that concludes the official business portion of the meeting, and there being no further official business, the meeting is hereby adjourned. Now I'd like to turn the program over to Raj Subramaniam, our CEO, and following his remarks, we'll conclude with any questions and answers. Raj?
Thank you, Mr. Chairman. For more than 50 years, our purpose at FedEx has been simple: to connect people and possibilities. We do so through the foundational principles our founder, Frederick W. Smith, established. A commitment to innovation, integrity, and serving our customers around the world. In a year marked by significant industry headwinds, that mindset drove strong results for FY 2026, reinforcing FedEx's position as the heartbeat of the industrial economy. I would like to thank our more than 450,000 FedEx team members around the world for driving such strong performance and for delivering the Purple Promise to make every FedEx experience outstanding. Through disciplined execution across our transformation initiatives, including Network 2.0 and Tricolor, we continue to build a more flexible, intelligent, and agile network in FY 2026.
Amid unprecedented global trade shifts, I'm proud of the durability and strength of our business, which translated to significant value creation for our stockholders. Our ongoing digital transformation supported internal efficiencies, a better customer experience, and our ability to build smarter and more resilient supply chains. Additionally, with the power of One FedEx and more centralized network planning, we reduced our capital expenditures to $3.8 billion in FY 2026, just 4% of our revenue, the lowest level in company history. This capital discipline, combined with strong profit growth, facilitated record adjusted free cash flow, enabling us to return approximately $2.2 billion to stockholders. Beyond our financial results, we successfully executed the spinoff of FedEx Freight, positioning both companies for success as standalone, focused industry leaders. We also hosted an Investor Day where we articulated our strategy for profitable growth and shared CY 2029 targets.
We continue to navigate change, execute our transformation, and shape the future of FedEx as a collective team. The FedEx of tomorrow will remain firm in our commitment to customers and our team members, while enabling significant value creation for stockholders. We look forward to sharing more about our progress with you all during our calendar year 2026 Q3 earnings call on October 28th. With that, we will now open it up for any questions.
Good morning, Brie Carere, Chief Customer Officer. The first question is about FedEx managing fluctuations in fuel prices. The answer we covered on our last quarterly earnings. As you all might remember, we update our weekly fuel surcharge dynamically. It has a less than two-week lag, and the goal is to manage any margin impact, which we have done incredibly effectively. Fuel surcharge capture remains very high, and as I mentioned on the last earnings call, to date, we have seen no impact on demand. Thank you.
This is Claude Russ, the Interim Chief Financial Officer. The second question is, did the FedEx tax rate percentage go down after the One Big Beautiful Bill Act, and what is the before and after-tax percent? We will provide an update on that on our next earnings call, as Raj said, on October the 28. The third question was what planes will be added in 2026, and what planes will be retired in 2026, and the numbers of each. You can find that information on our investor relations website and our stat book.
Thank you for those questions. Seeing no further questions, we thank you for your participation today. With that, the meeting is concluded.