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Business Segment Information | 12 Months Ended
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May 31, 2018
Segment Reporting Disclosure Of Entitys Reportable Segments [Abstract] |
Business Segment Information | NOTE 14: BUSINESS SEGMENT INFORMATION FedEx Express, FedEx Ground and FedEx Freight represent our major service lines and, along with FedEx Services, constitute our reportable segments. Our reportable segments include the following businesses:
FedEx Express Segment | FedEx Express (express transportation)
| TNT Express (international express transportation, small-package ground delivery and freight transportation)
FedEx Ground Segment | FedEx Ground (small-package ground delivery)
FedEx Freight Segment | FedEx Freight (LTL freight transportation)
FedEx Services Segment | FedEx Services (sales, marketing, information technology, communications, customer service, technical support, billing and collection services and back-office functions)
| FedEx Office (document and business services and package acceptance)
In 2018, FedEx Express and TNT Express are reported as one segment. This new segment is the result of combining the financial information of the FedEx Express and TNT Express segments (previously referred to as the FedEx Express group) as part of the operational integration of these two businesses. As integration activities have progressed, the FedEx Express and TNT Express businesses have lost their historical discrete financial profiles, as the businesses are being combined. Therefore, discrete financial information for FedEx Express and TNT Express does not exist in a manner to evaluate performance and make resource allocation decisions. In addition, this new reporting structure aligns with our management reporting structure and our internal financial reporting and compensation plans. In the fourth quarter of 2018, we realigned our specialty logistics and e-commerce solutions in a new organizational structure under FedEx Trade Networks. The realignment allows us to improve our ability to deliver the capabilities of our specialty services companies to customers. The new organization includes FedEx Trade Networks Transport & Brokerage, Inc., FedEx Cross Border Technologies, Inc., FedEx Supply Chain, FedEx Custom Critical, Inc., and FedEx Forward Depots, Inc. FedEx Trade Networks operating segment results are included in “Corporate, other and eliminations” in our segment reporting. Prior period segment results for all of our transportation segments have been recast to conform to the current year presentation for these organizational structure changes. FedEx Services Segment The FedEx Services segment operates combined sales, marketing, administrative and information-technology functions in shared services operations that support our transportation businesses and allow us to obtain synergies from the combination of these functions. For the international regions of FedEx Express some of these functions are performed on a regional basis and reported by each respective company in their natural expense line items. The FedEx Services segment includes: FedEx Services, which provides sales, marketing, information technology, communications, customer service, technical support, billing and collection services for U.S. customers of our major business units and certain back-office support to our other companies; and FedEx Office, which provides an array of document and business services and retail access to our customers for our package transportation businesses. The FedEx Services segment provides direct and indirect support to our transportation businesses, and we allocate all of the net operating costs of the FedEx Services segment (including the net operating results of FedEx Office) to reflect the full cost of operating our transportation businesses in the results of those segments. Within the FedEx Services segment allocation, the net operating results of FedEx Office, which are an immaterial component of our allocations, are allocated to FedEx Express and FedEx Ground. We review and evaluate the performance of our transportation segments based on operating income (inclusive of FedEx Services segment allocations). For the FedEx Services segment, performance is evaluated based on the impact of its total allocated net operating costs on our transportation segments. Operating expenses for each of our transportation segments include the allocations from the FedEx Services segment to the respective transportation segments. These allocations also include charges and credits for administrative services provided between operating companies. The allocations of net operating costs are based on metrics such as relative revenues or estimated services provided. We believe these allocations approximate the net cost of providing these functions. Our allocation methodologies are refined periodically, as necessary, to reflect changes in our businesses. Other Intersegment Transactions Corporate and other includes corporate headquarters costs for executive officers and certain legal and finance functions, as well as certain other costs and credits not attributed to our core business. These costs are not allocated to the other business segments. Also included in corporate and other is the FedEx Trade Networks operating segment, which provides customs brokerage and global ocean and air freight forwarding through FedEx Trade Networks Transport & Brokerage; cross-border enablement and technology solutions and e-commerce transportation solutions through FedEx Cross Border; integrated supply chain management solutions through FedEx Supply Chain; time-critical shipment services through FedEx Custom Critical; and, effective September 1, 2018, critical inventory and service parts logistics, 3-D printing and technology repair through FedEx Forward Depots. Certain FedEx operating companies provide transportation and related services for other FedEx companies outside their reportable segment. Billings for such services are based on negotiated rates, which we believe approximate fair value, and are reflected as revenues of the billing segment. These rates are adjusted from time to time based on market conditions. Such intersegment revenues and expenses are eliminated in our consolidated results and are not separately identified in the following segment information, because the amounts are not material. The following table provides a reconciliation of reportable segment revenues, depreciation and amortization, operating income (loss) and segment assets to consolidated financial statement totals (in millions) for the years ended or as of May 31:
|  | FedEx Express Segment |  |  | FedEx Ground Segment |  |  | FedEx Freight Segment |  |  | FedEx Services Segment |  |  | Corporate, other and eliminations(1) |  |  | Consolidated Total |
Revenues |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
2018 |  | $ | 36,172 |  |  | $ | 18,395 |  |  | $ | 6,812 |  |  | $ | 1,650 |  |  | $ | 2,421 |  |  | $ | 65,450 |
2017 |  |  | 33,824 |  |  |  | 16,503 |  |  |  | 6,070 |  |  |  | 1,621 |  |  |  | 2,301 |  |  |  | 60,319 |
2016 |  |  | 25,553 |  |  |  | 15,051 |  |  |  | 5,825 |  |  |  | 1,593 |  |  |  | 2,343 |  |  |  | 50,365 |
Depreciation and amortization |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
2018 |  | $ | 1,679 |  |  | $ | 681 |  |  | $ | 296 |  |  | $ | 382 |  |  | $ | 57 |  |  | $ | 3,095 |
2017 |  |  | 1,662 |  |  |  | 627 |  |  |  | 265 |  |  |  | 371 |  |  |  | 70 |  |  |  | 2,995 |
2016 |  |  | 1,377 |  |  |  | 556 |  |  |  | 244 |  |  |  | 384 |  |  |  | 70 |  |  |  | 2,631 |
Operating income (loss) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
2018(2) |  | $ | 2,578 |  |  | $ | 2,605 |  |  | $ | 517 |  |  | $ | — |  |  | $ | (830 | ) |  | $ | 4,870 |
2017(3) |  |  | 2,769 |  |  |  | 2,279 |  |  |  | 390 |  |  |  | — |  |  |  | (401 | ) |  |  | 5,037 |
2016(4) |  |  | 2,485 |  |  |  | 2,240 |  |  |  | 421 |  |  |  | — |  |  |  | (2,069 | ) |  |  | 3,077 |
Segment assets(5) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
2018 |  | $ | 31,753 |  |  | $ | 15,458 |  |  | $ | 7,389 |  |  | $ | 6,377 |  |  | $ | (8,647 | ) |  | $ | 52,330 |
2017 |  |  | 31,307 |  |  |  | 12,969 |  |  |  | 6,527 |  |  |  | 5,682 |  |  |  | (7,933 | ) |  |  | 48,552 |
2016 |  |  | 20,798 |  |  |  | 11,407 |  |  |  | 6,104 |  |  |  | 5,390 |  |  |  | 2,260 |  |  |  | 45,959 |
(1) | Includes TNT Express’s assets and immaterial financial results for 2016 from the time of acquisition (May 25, 2016).
(2) | Includes TNT Express integration expenses and restructuring charges of $477 million and a gain of $10 million associated with our annual MTM retirement plans accounting adjustment. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes goodwill and other asset impairment charges of $380 million.
(3) | Includes TNT Express integration expenses and restructuring charges of $327 million and a gain of $24 million associated with our MTM retirement plans accounting. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes $39 million of charges for legal reserves related to certain pending U.S. Customs and Border Protection (“CBP”) matters involving FedEx Trade Networks and $22 million of charges in connection with the settlement of and certain expected losses relating to independent contractor litigation matters at FedEx Ground. See Note 18 below for additional information.
(4) | Includes a $1.5 billion loss associated with our MTM retirement plans accounting. Also includes provisions for the settlement of and expected losses related to independent contractor litigation matters at FedEx Ground for $256 million and expenses related to the settlement of a CBP notice of action involving FedEx Trade Networks in the amount of $69 million, in each case net of recognized immaterial insurance recovery, and transaction and integration-planning expenses related to our TNT Express acquisition of $113 million.
(5) | Segment assets include intercompany receivables.
The following table provides a reconciliation of reportable segment capital expenditures to consolidated totals for the years ended May 31 (in millions):
|  | FedEx Express Segment |  |  |  | FedEx Ground Segment |  |  | FedEx Freight Segment |  |  | FedEx Services Segment |  |  | Other |  |  | Consolidated Total |
2018 |  | $ | 3,461 |  |  |  | $ | 1,178 |  |  | $ | 490 |  |  | $ | 477 |  |  | $ | 57 |  |  | $ | 5,663 |
2017 |  |  | 2,725 |  |  |  |  | 1,490 |  |  |  | 431 |  |  |  | 416 |  |  |  | 54 |  |  |  | 5,116 |
2016 |  |  | 2,350 |  |  |  |  | 1,556 |  |  |  | 428 |  |  |  | 432 |  |  |  | 52 |  |  |  | 4,818 |
The following table presents revenue by service type and geographic information for the years ended or as of May 31 (in millions):
|  | 2018 |  |  | 2017 |  |  | 2016 |
REVENUE BY SERVICE TYPE |  |  |  |  |  |  |  |  |  |  |  |
FedEx Express segment: |  |  |  |  |  |  |  |  |  |  |  |
Package: |  |  |  |  |  |  |  |  |  |  |  |
U.S. overnight box |  | $ | 7,273 |  |  | $ | 6,955 |  |  | $ | 6,763 |
U.S. overnight envelope |  |  | 1,788 |  |  |  | 1,750 |  |  |  | 1,662 |
U.S. deferred |  |  | 3,738 |  |  |  | 3,526 |  |  |  | 3,379 |
Total U.S. domestic package revenue |  |  | 12,799 |  |  |  | 12,231 |  |  |  | 11,804 |
International priority |  |  | 7,356 |  |  |  | 6,940 |  |  |  | 5,697 |
International economy |  |  | 3,255 |  |  |  | 2,876 |  |  |  | 2,282 |
Total international export package revenue |  |  | 10,611 |  |  |  | 9,816 |  |  |  | 7,979 |
International domestic(1) |  |  | 4,587 |  |  |  | 4,227 |  |  |  | 1,285 |
Total package revenue |  |  | 27,997 |  |  |  | 26,274 |  |  |  | 21,068 |
Freight: |  |  |  |  |  |  |  |  |  |  |  |
U.S. |  |  | 2,797 |  |  |  | 2,527 |  |  |  | 2,481 |
International priority |  |  | 2,179 |  |  |  | 1,910 |  |  |  | 999 |
International economy |  |  | 1,916 |  |  |  | 1,740 |  |  |  | 385 |
International airfreight |  |  | 368 |  |  |  | 355 |  |  |  | 126 |
Total freight revenue |  |  | 7,260 |  |  |  | 6,532 |  |  |  | 3,991 |
Other |  |  | 915 |  |  |  | 1,018 |  |  |  | 494 |
Total FedEx Express segment |  |  | 36,172 |  |  |  | 33,824 |  |  |  | 25,553 |
FedEx Ground segment |  |  | 18,395 |  |  |  | 16,503 |  |  |  | 15,051 |
FedEx Freight segment |  |  | 6,812 |  |  |  | 6,070 |  |  |  | 5,825 |
FedEx Services segment |  |  | 1,650 |  |  |  | 1,621 |  |  |  | 1,593 |
Other and eliminations(2) |  |  | 2,421 |  |  |  | 2,301 |  |  |  | 2,343 |
|  | $ | 65,450 |  |  | $ | 60,319 |  |  | $ | 50,365 |
GEOGRAPHICAL INFORMATION(3) |  |  |  |  |  |  |  |  |  |  |  |
Revenues: |  |  |  |  |  |  |  |  |  |  |  |
U.S. |  | $ | 43,581 |  |  | $ | 40,269 |  |  | $ | 38,070 |
International: |  |  |  |  |  |  |  |  |  |  |  |
FedEx Express segment |  |  | 20,417 |  |  |  | 18,817 |  |  |  | 11,083 |
FedEx Ground segment |  |  | 407 |  |  |  | 331 |  |  |  | 275 |
FedEx Freight segment |  |  | 181 |  |  |  | 149 |  |  |  | 137 |
FedEx Services segment |  |  | 3 |  |  |  | 10 |  |  |  | 10 |
Other(2) |  |  | 861 |  |  |  | 743 |  |  |  | 790 |
Total international revenue |  |  | 21,869 |  |  |  | 20,050 |  |  |  | 12,295 |
|  | $ | 65,450 |  |  | $ | 60,319 |  |  | $ | 50,365 |
Noncurrent assets: |  |  |  |  |  |  |  |  |  |  |  |
U.S. |  | $ | 30,362 |  |  | $ | 28,141 |  |  | $ | 25,942 |
International |  |  | 8,627 |  |  |  | 7,783 |  |  |  | 8,028 |
|  | $ | 38,989 |  |  | $ | 35,924 |  |  | $ | 33,970 |
(1) | International domestic revenues relate to our intra-country operations.
(2) | Includes the FedEx Trade Networks operating segment and TNT Express’s revenue for 2016 from the time of acquisition (May 25, 2016).
(3) | International revenue includes shipments that either originate in or are destined to locations outside the United States, which could include U.S. payors. Noncurrent assets include property and equipment, goodwill and other long-term assets. Our flight equipment is registered in the U.S. and is included as U.S. assets; however, many of our aircraft operate internationally.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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