“With regard to Q3 adjusted EPS, we now anticipate adjusted EPS to be sequentially lower than Q2.”

In context

“onstrates our commitment to revenue quality and pricing traction. Our bridge includes partial offsets to these tailwinds, most remain unchanged from what we shared in September except for the FedEx freight headwind. We now expect a $300 million decline in adjusted operating income at FedEx Freight compared to the $100 million expectation we shared in September. Additionally, we added a bar to reflect the variable incentive compensation headwind I mentioned earlier. As I mentioned last quarter, embedded in our assumptions is the $1 billion in headwind to adjusted operating profit from the global trade environment offset by $1 billion in transformation-related savings. We're pleased with our year-to-date cost reduction progress and are on track to achieve the billion dollars savings target. With regard to Q3 adjusted EPS, we now anticipate adjusted EPS to be sequentially lower than Q2. For further context, we expect Q3 revenue to be essentially in line with Q2 with slight increases sequentially in operating expense due to increased peak demand and higher cost due to the MD-11 grounding. And as a reminder, we are lapping a third quarter that was unusually strong seasonally. We expect Q4 to be our strongest adjusted EPS quarter of this fiscal year these directional trends are consistent with the patterns we typically experience. Before turning to Q&A, I want to provide an update on our spin-off of FedEx Freight, which is on track for 06/01/2026. As previously mentioned, we submitted our confidential form 10 to the SEC as well as a request for a private letter ruling on the tax treatment of the transaction to the IRS. These were important milestones as we move toward the t”