The package-delivery giant said reduced demand for priority services and higher operating costs weighed on its results.

STORY: FedEx shares tumbled almost 11% in U.S. after-hours trade on Thursday. The plunge came after the delivery giant reported a steep drop in quarterly profits, and lowered its forecast for the full year.

FedEx reported a lower first-quarter profit on Thursday as demand in the package industry remained muted, especially for priority services.

FedEx saw revenues and profits decline in its fiscal first quarter as the company faced challenging market conditions, customers opted for less expensive

FedEx’s results were dragged down by weaker-than-expected demand, particularly in the U.S. domestic package market.

FedEx Corp shares slumped on Friday after the parcel giant cut its annual revenue forecast and reported a sharp fall in profits, owing to weak demand for high-margin speedy delivery services. Shares of the company were down nearly 13% in premarket trading,

FedEx came up short on top and bottom lines, and guidance revisions suggest there is more bad news to come in fiscal 2025.