Brie Carere: Okay, Scott. Let me try to unpack that. I think, first of all, from a peak perspective, our peak volumes are very much in line with what we anticipated for the month of December. And from a structural pricing perspective in peak, as you know, peak surcharges are a significant contribution to the month of December and we are very pleased. They continue to be something that we are enforcing and customers really understand that. They are there to cover the incremental costs from our largest peaking customers. So, from a peak perspective, we feel really good. As I mentioned, there is no question I get asked more around here, is that, are we holding on to all of the share that we took from UPS? And the answer I can give you is confidently, yes.
We gave you last quarter, the 400,000 average daily packages. That’s a slightly conservative number. We are tracking all accounts that won — we won, specifically because of their concerns on the labor negotiations. The vast majority of those had an early termination clause. And to my knowledge, we have not lost a single one of those accounts. Now, of course, we do trade accounts with UPS and we have accounted for the trades between the two of us over the last quarter. And we’re still up more than 400,000 average daily packages in the United States. In addition, we looked at their Q3 numbers, we’ve gained share. And also, I think it’s important to note, we gained share here in the United States, but globally, we outperformed the market. So, it’s a confident yes, and we have the better value proposition.
I believe we have the better commercial team. I’m confident we’ll hold on.
Operator: The next question will come from Stephanie Moore with Jefferies. Please go ahead.
Stephanie Moore: Hi, thank you. I appreciate the question. Maybe touching on the prior one, talking about the demand environment. Well, first, I’m kind of curious what you are seeing on the International side of your business and just the reports of tighter air cargo markets from kind of the lower-cost e-commerce exports out of Asia, if that’s had any impact as of late on your business? And then, more of a broader view, what’s your view on when you think the slowing environment might finally turn the corner here, just based on what you’re seeing today? Thanks.
Brie Carere: Sure. Great question. I think, as Raj mentioned, of course, we’re tracking all of the same economic indicators that all of you are tracking. And when you look at some of those indicators, you do start to see some optimism. What we’re doing is, we’re planning conservatively. Right now, we believe that there will we will see FedEx sequential improvement throughout the back0 half, but the overall market demand will not change within our fiscal year. When we’ve seen the momentum, I talked about a couple of places where we’ve got momentum, specifically on parcel, that — the vast majority of that is two things, it’s e-commerce and its market share gains. When we look at the largest indicator of industrial production and what we’re seeing, we’re not seeing a lot of restocking in our numbers yet.
It doesn’t mean that it won’t come, but we’re not seeing it yet. One of the greatest indicators of that is, actually, if you look at our Freight business outside of the United States, weights are not where they need to be. Shipment volume was decent, but it’s really the weight that we’re looking at and weight per shipment is still down dramatically as you can see in the numbers. So, we’re planning conservatively. We’re focused very much on what we can control. And of course, we’ll keep you updated as things move on.
Operator: The next question will come from Bruce Chan with Stifel. Please go ahead.
Bruce Chan: Great. Thanks for the time. Just maybe I want to get a follow-up on Network 2.0. If you could give us an update on where you are with the market network integration? I imagine it was a little bit slower during peak season, but what’s been completed at this point, and what markets are next? And then maybe just a follow-up for John here, in terms of the model, where should we think about where the impact of those changes occur with regard to the up guidance?
Raj Subramaniam: Okay. Bruce, let me take the first part and then I’ll turn it over to John. As we have — we are on track to our Network 2.0 for in implementation, as we’ve told you by fiscal year 2027. We have announced and/or implemented optimization changes in Alaska, Hawaii, Canada, as well as several locations in the lower 48, and we have learned a lot in this process. And in January, we’ll announce the next wave of rollout once we get past the peak season. So, overall, we are on track. We’re learning a lot in this process here. We’re building the right technology solutions and the facilities required to move forward. And I’m quite pleased with the progress.
John Dietrich: Yes. And Raj, what I would just add to that is that our expectations as a result of all of that planning is factored into our guidance.
Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Mr. Raj Subramaniam for any closing remarks. Please go ahead, sir.
Raj Subramaniam: So, thank you very much. And in closing, we are showing clear progress on our transformation, delivering an unprecedented two consecutive quarters of operating income growth and margin expansion even with lower revenue. At the same time, we are providing our customers with outstanding service and speed through the peak and beyond. I’m very confident in our path ahead as we become a more flexible, efficient, and intelligent Company. Let me take this opportunity to once again thank the FedEx team members for delivering just a simply an outstanding peak. I was the best peak season I can remember in some time to come. And we also take this opportunity to wish everyone on this call and all our FedEx team members a very, very happy holiday season. Thank you very much.
Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.
