On an adjusted basis, FedEx forecast quarterly earnings between $3.40 and $4.00 per share, while analysts expected $4.06 per share, according to LSEG data.

FedEx (FDX) stock slipped 5.8% in extended trading on Tuesday after the company’s first-quarter earnings forecast fell short of Wall Street’s expectations.

On an adjusted basis, FedEx forecasted quarterly earnings between $3.40 and $4.00 per share, while analysts expect it to post $4.06 per share, according to LSEG data.

It also expects revenue growth for the fiscal first quarter to be between flat and 2%. FedEx said that the forecast includes about $570 million of specific adverse impacts resulting from the expiration of the U.S. Postal Service contract and recent trade disruptions.

FedEx and rival UPS are considered the bellwethers for the economy, as they cater to the manufacturing and consumer goods industries. UPS stock also slipped marginally in extended trading.

Unlike other years, FedEx did not issue a full-year outlook, taking a cautious approach due to an “uncertain global demand environment.” U.S. President Donald Trump’s trade war with Beijing has led to a severe decline in shipments between the U.S. and China, FedEx’s most profitable route. The company said it slashed its capacity in its Asia-to-Americas lane by more than 35% in May compared to April.

“We just simply cannot predict how that is going to play out,” FedEx Chief Customer Officer Brie Carere said as the July 9 deadline imposed by the Trump administration on its trading partners to agree to trade deals fast approaches. So far, the White House has only agreed to a framework for an agreement with the UK.

While the U.S. has agreed to slash tariffs on Chinese goods, the Trump administration’s move to remove an exemption granted to small parcels valued below $800 from China has severely hurt parcel delivery firms, such as FedEx, and low-cost retailers like Shein and Temu.

The company topped fourth-quarter profit expectations, backed by cost-cutting efforts and a sequential rise in average daily volumes.

Retail sentiment on Stocktwits was in the ‘extremely bullish’ (99/100) territory, while retail chatter was ‘extremely high.’

“Nice low entry price... good future, no fear,” one user said.

Another trader speculated that if there’s a benchmark rate cut in July, the stock could rise again.

FedEx stock has fallen 18.5% this year.

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