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FedEx Corps shares took a hit on Wednesday after the worlds largest cargo airline projected lower full-year earnings, despite a huge jump in third-quarter profit.

The package delivery company reported a net income of $580 million, or $2.01 a share, for the three months ended February 28, up 53% compared to last years $378 million, or $1.23 a share.

During a conference call on Wednesday, FedEx representatives said that the company benefited greatly from its cost-cutting program, which was mainly focused on FedExs largest division. The company parted ways with 3 600 employees during the restructuring of its air unit, which brings more than half of the overall revenue. The company aims to modernize its top performer and reposition it to better compete with rivals.

FedEx also said it benefited from favorable weather conditions and the low oil prices, which led to an operating income of $384 million, more than doubled compared to last year. However, revenue from the unit was flat at $6.66 billion.

FedEx ground segment, the companys second largest, reported a revenue increase of 12% to $3.93 billion, driven by a robust holiday performance and an increase in base prices. Additionally, FedEx introduced a new pricing method in January that charges customers based on both the size and weight of the package.

Previously, FedEx was only taking into consideration the weight of a package when calculating the price of a delivery, however, with the rise of the e-commerce business the company had to modify its pricing model. The change was aimed at online retailers who are not efficient with their packaging and would often use a big box to ship a small item, which resulted in full delivery trucks for FedEx which were well below their weight capacity. Revenue per package increased 3% in the quarter.

Overall revenue edged up 4% to $11.3 billion. According to a survey by Thomson Reuters, analysts had projected a revenue of $11.8 billion with per-share earning of $1.87.

FedEx projected full-year earnings per share to be in the range of $8.80 and $8.95 due to “continued moderate global economic growth”. The company had previously estimated per-share earnings of between $8.50 and $9.

FedEx lost 1.37% on Wednesday and closed at $173.3 in New York, marking a one-year increase of 25.06%. The company is valued at $50.24 billion. The stock slipped 0.08% on Thursday to $173.16 during after-hours trading.

According to the Financial Times, the 24 analysts offering 12-month price targets for FedEx have a median target of $195.50, with a high estimate of $210.00 and a low estimate of $155.00. The median estimate represents a 12.81% increase from the last closing price.

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