FedEx Corp. reduced its profit outlook for the year through May after quarterly earnings dropped for the first time in almost three years amid reduced demand for premium shipping services.

Earnings will be $6.20 to $6.60 a share compared with a previous forecast of $6.90 to $7.40, excluding potential benefits from cost cuts that the Memphis, Tennessee-based company is reviewing. FedEx said in a statement that it will boost rates at its FedEx Express unit.

“Weakness in the global economy constrained revenue growth at FedEx Express during our first quarter and affected our earnings,” Chief Executive Officer Fred Smith said in the statement. “We are taking further actions to reduce costs and adjust our networks to match current and anticipated shipment volumes.”

FedEx fell 3.1 percent to $86.50 at 7:32 a.m. in New York before regular trading. The shares gained 6.9 percent this year through yesterday.

Net income for the quarter ended Aug. 31 declined to $459 million, or $1.45 a share, from $464 million, or $1.46, a year earlier, the company said in the statement. That topped the $1.40 average of 23 analyst estimates compiled by Bloomberg.

FedEx forecast second-quarter earnings of $1.30 to $1.45 a share, below the $1.67 average from 23 estimates compiled by Bloomberg.

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FedEx Cuts Outlook

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