FEDEX CORP, 10-K filed on 7/20/2020
Annual Report
v3.20.2
Document and Entity Information - USD ($)
$ in Billions
 12 Months Ended
May 31, 2020
Jul. 16, 2020
Nov. 30, 2019
Document Information [Line Items]      
Document Type 10-K    
Document Period End Date May 31, 2020    
Amendment Flag false    
Document Fiscal Year Focus 2020    
Document Fiscal Period Focus FY    
Entity Registrant Name FEDEX CORP    
Entity Central Index Key 0001048911    
Current Fiscal Year End Date --05-31    
Entity Well-known Seasoned Issuer Yes    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Filer Category Large Accelerated Filer    
Entity File Number 1-15829    
Entity Tax Identification Number 62-1721435    
Entity Address, Address Line One 942 South Shady Grove Road    
Entity Address, City or Town Memphis    
Entity Address, State or Province TN    
Entity Address, Postal Zip Code 38120    
City Area Code 901    
Local Phone Number 818-7500    
Entity Interactive Data Current Yes    
Entity Shell Company false    
Entity Small Business false    
Entity Emerging Growth Company false    
Entity Public Float     $ 38.1
Entity Common Stock, Shares Outstanding   261,954,496  
Entity Incorporation, State or Country Code DE    
Document Annual Report true    
Document Transition Report false    
Documents Incorporated by Reference

Portions of the Registrant’s definitive proxy statement to be delivered to stockholders in connection with the 2020 annual meeting of stockholders to be held on September 21, 2020 are incorporated by reference in response to Part III of this Report.

   
Common Stock, Par Value $0.10 Per Share [Member]      
Document Information [Line Items]      
Trading Symbol FDX    
Title of 12(b) Security Common Stock, par value $0.10 per share    
Security Exchange Name NYSE    
0.700% Notes Due 2022 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 22B    
Title of 12(b) Security 0.700% Notes due 2022    
Security Exchange Name NYSE    
1.000% Notes Due 2023 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 23A    
Title of 12(b) Security 1.000% Notes due 2023    
Security Exchange Name NYSE    
0.450% Notes Due 2025 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 25A    
Title of 12(b) Security 0.450% Notes due 2025    
Security Exchange Name NYSE    
1.625% Notes Due 2027 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 27    
Title of 12(b) Security 1.625% Notes due 2027    
Security Exchange Name NYSE    
1.300% Notes Due 2031 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 31    
Title of 12(b) Security 1.300% Notes due 2031    
Security Exchange Name NYSE    
v3.20.2
Consolidated Balance Sheets - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
CURRENT ASSETS    
Cash and cash equivalents $ 4,881 $ 2,319
Receivables, less allowances of $390 and $300 10,102 9,116
Spare parts, supplies and fuel, less allowances of $335 and $335 572 553
Prepaid expenses and other 828 1,098
Total current assets 16,383 13,086
PROPERTY AND EQUIPMENT, AT COST    
Aircraft and related equipment 24,518 22,793
Package handling and ground support equipment 11,382 10,409
Information technology 6,884 6,268
Vehicles and trailers 9,101 8,339
Facilities and other 13,139 11,702
Gross property and equipment 65,024 59,511
Less accumulated depreciation and amortization 31,416 29,082
Net property and equipment 33,608 30,429
OTHER LONG-TERM ASSETS    
Operating lease right-of-use assets, net 13,917  
Goodwill 6,372 6,884
Other assets 3,257 4,004
Total other long-term assets 23,546 10,888
ASSETS [1] 73,537 54,403
CURRENT LIABILITIES    
Current portion of long-term debt 51 964
Accrued salaries and employee benefits 1,569 1,741
Accounts payable 3,269 3,030
Operating lease liabilities 1,923  
Accrued expenses 3,532 3,278
Total current liabilities 10,344 9,013
LONG-TERM DEBT, LESS CURRENT PORTION 21,952 16,617
OTHER LONG-TERM LIABILITIES    
Deferred income taxes 3,162 2,821
Pension, postretirement healthcare and other benefit obligations 5,019 5,095
Self-insurance accruals 2,104 1,899
Operating lease liabilities 12,195  
Deferred lease obligations   531
Other liabilities 466 670
Total other long-term liabilities 22,946 11,016
COMMITMENTS AND CONTINGENCIES
COMMON STOCKHOLDERS' INVESTMENT    
Common stock, $0.10 par value; 800 million shares authorized; 318 million shares issued as of May 31, 2020 and 2019 32 32
Additional paid-in capital 3,356 3,231
Retained earnings 25,216 24,648
Accumulated other comprehensive loss (1,147) (865)
Treasury stock, at cost (9,162) (9,289)
Total common stockholders’ investment 18,295 17,757
LIABILITIES AND COMMON STOCKHOLDERS' INVESTMENT $ 73,537 $ 54,403
[1] Segment assets include intercompany receivables.
v3.20.2
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
CURRENT ASSETS    
Allowances for receivables $ 390 $ 300
Allowances for spare parts, supplies and fuel $ 335 $ 335
COMMON STOCKHOLDERS' INVESTMENT    
Common stock, par value $ 0.10 $ 0.10
Common stock, shares authorized 800,000,000 800,000,000
Common stock, shares issued 318,000,000 318,000,000
v3.20.2
Consolidated Statements of Income - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Income Statement [Abstract]      
REVENUE [1] $ 69,217 $ 69,693 [2] $ 65,450 [2]
OPERATING EXPENSES:      
Salaries and employee benefits 25,031 24,776 23,795
Purchased transportation 17,466 16,654 15,101
Rentals and landing fees 3,712 3,360 3,361
Depreciation and amortization 3,615 3,353 3,095
Fuel 3,156 3,889 3,374
Maintenance and repairs 2,893 2,834 2,622
Goodwill and other asset impairment charges 435   380
Business realignment costs   320  
Other 10,492 10,041 9,450
OPERATING EXPENSES 66,800 65,227 61,178
OPERATING INCOME 2,417 [3] 4,466 [4] 4,272 [5]
OTHER (EXPENSE) INCOME:      
Interest expense (672) (588) (558)
Interest income 55 59 48
Other retirement plans (expense) income (122) (3,251) 598
Other, net (9) (31) (7)
OTHER (EXPENSE) INCOME (748) (3,811) 81
INCOME BEFORE INCOME TAXES 1,669 655 4,353
PROVISION FOR INCOME TAXES (BENEFIT) 383 115 (219)
NET INCOME $ 1,286 $ 540 $ 4,572
BASIC EARNINGS PER COMMON SHARE $ 4.92 $ 2.06 $ 17.08
DILUTED EARNINGS PER COMMON SHARE $ 4.90 $ 2.03 $ 16.79
[1] 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.
[2] Prior year amounts have been revised to conform to the current year presentation.
[3] Includes TNT Express integration expenses of $270 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes noncash goodwill and other asset impairment charges of $435 million primarily related to goodwill impairment at FedEx Office and from the decision to permanently retire certain aircraft and related engines at FedEx Express.
[4] Includes TNT Express integration expenses (including restructuring charges) of $388 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes business realignment costs of $320 million included in “Corporate, other and eliminations” and costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
[5] Includes TNT Express integration expenses (including restructuring charges) of $477 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes goodwill and other asset impairment charges of $380 million included in “Corporate, other and eliminations.”
v3.20.2
Consolidated Statements of Comprehensive Income - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Statement Of Income And Comprehensive Income [Abstract]      
NET INCOME $ 1,286 $ 540 $ 4,572
OTHER COMPREHENSIVE LOSS:      
Foreign currency translation adjustments, net of tax benefit of $18 in 2020, $29 in 2019, and tax expense of $16 in 2018 (254) (195) (74)
Amortization of prior service credit and other, net of tax benefits of $25 in 2020, $28 in 2019, and $37 in 2018. (79) (92) (89)
Other comprehensive income (loss) (333) (287) (163)
COMPREHENSIVE INCOME $ 953 $ 253 $ 4,409
v3.20.2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Other Comprehensive Income, Tax Amounts      
Foreign currency translation adjustments, tax expense (benefit) $ (18) $ (29) $ 16
Amortization of prior service credit and other, tax benefits $ 25 $ 28 $ 37
v3.20.2
Consolidated Statements of Cash Flows - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
OPERATING ACTIVITIES      
Net income $ 1,286 $ 540 $ 4,572
Adjustments to reconcile net income to cash provided by operating activities:      
Depreciation and amortization 3,615 3,353 3,095
Provision for uncollectible accounts 442 295 246
Other noncash items and deferred income taxes 2,449 (233) (231)
Stock-based compensation 168 174 167
Retirement plans mark-to-market adjustment 794 3,882 (10)
Gain from sale of business   (8) (85)
Business realignment costs   101  
Goodwill and other asset impairment charges 435   380
Changes in assets and liabilities:      
Receivables (1,331) (873) (1,049)
Other current assets (59) (25) (135)
Pension and postretirement healthcare assets and liabilities, net (908) (909) (2,345)
Accounts payable and other liabilities (1,787) (571) 141
Other, net (7) (113) (72)
Cash provided by operating activities 5,097 5,613 4,674
INVESTING ACTIVITIES      
Capital expenditures (5,868) (5,490) (5,663)
Business acquisitions, net of cash acquired   (66) (179)
Proceeds from sale of business     123
Proceeds from asset dispositions and other 22 83 42
Cash used in investing activities (5,846) (5,473) (5,677)
FINANCING ACTIVITIES      
Principal payments on debt (2,548) (1,436) (38)
Proceeds from debt issuances 6,556 2,463 1,480
Proceeds from stock issuances 64 101 327
Dividends paid (679) (683) (535)
Purchase of treasury stock (3) (1,480) (1,017)
Other, net (9) (4) 10
Cash provided by (used in) financing activities 3,381 (1,039) 227
Effect of exchange rate changes on cash (70) (47) 72
Net increase (decrease) in cash and cash equivalents 2,562 (946) (704)
Cash and cash equivalents at beginning of period 2,319 3,265 3,969
Cash and cash equivalents at end of period $ 4,881 $ 2,319 $ 3,265
v3.20.2
Consolidated Statements of Changes in Common Stockholders' Investment - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
Aug. 31, 2019
May 31, 2019
Aug. 31, 2018
May 31, 2020
May 31, 2019
May 31, 2018
Beginning Balance   $ 17,757   $ 19,416 $ 17,757 $ 19,416 $ 16,073
Net income $ (334) [1],[2] 745 [1],[2] $ (1,969) [3],[4] 835 [3],[4] 1,286 540 4,572
Other comprehensive loss, net of tax         (333) (287) (163)
Purchase of treasury stock         (3) (1,480) (1,017)
Cash dividends declared         (679) (683) (535)
Employee incentive plans and other         220 251 486
Ending Balance 18,295   17,757   18,295 17,757 19,416
Accounting Standards Update 2016-02 and 2018-02              
Adoption of new accounting standards on June 1, 2019 [5]         (4)    
Accounting Standards Update 2018-02              
Reclassification to retained earnings due to the adoption of a new accounting standard on June 1, 2019 [6]         51    
Common Stock              
Beginning Balance   32   32 32 32 32
Ending Balance 32   32   32 32 32
Additional Paid-In Capital              
Beginning Balance   3,231   3,117 3,231 3,117 3,005
Employee incentive plans and other         125 114 112
Ending Balance 3,356   3,231   3,356 3,231 3,117
Retained Earnings              
Beginning Balance   24,648   24,823 24,648 24,823 20,833
Net income         1,286 540 4,572
Cash dividends declared         (679) (683) (535)
Employee incentive plans and other         (35) (32) (47)
Ending Balance 25,216   24,648   25,216 24,648 24,823
Retained Earnings | Accounting Standards Update 2016-02 and 2018-02              
Adoption of new accounting standards on June 1, 2019 [5]         (4)    
Accumulated Other Comprehensive Loss              
Beginning Balance   (865)   (578) (865) (578) (415)
Other comprehensive loss, net of tax         (333) (287) (163)
Ending Balance (1,147)   (865)   (1,147) (865) (578)
Accumulated Other Comprehensive Loss | Accounting Standards Update 2018-02              
Reclassification to retained earnings due to the adoption of a new accounting standard on June 1, 2019 [6]         51    
Treasury Stock              
Beginning Balance   $ (9,289)   $ (7,978) (9,289) (7,978) (7,382)
Purchase of treasury stock         (3) (1,480) (1,017)
Employee incentive plans and other         130 169 421
Ending Balance $ (9,162)   $ (9,289)   $ (9,162) $ (9,289) $ (7,978)
[1] The fourth quarter of 2020 includes a tax benefit of $71 million in connection with the 2020 U.S. tax loss that can be offset against income in prior years under the CARES Act and a tax expense of $51 million due to a change in deferred tax balances related to foreign tax operations. The second quarter of 2020 includes a tax benefit of $133 million from the reduction of a valuation allowance on certain foreign tax loss carryforwards.
[2] The fourth quarter, third quarter, second quarter and first quarter of 2020 include $63 million, $72 million, $64 million and $71 million, respectively, of TNT Express integration expenses. The fourth quarter includes $369 million of goodwill and other asset impairment charges associated with the FedEx Office and FedEx Logistics operating segments and a net loss of $794 million related to the annual MTM retirement plans accounting adjustment. The second quarter of 2020 includes asset impairment charges of $66 million related to the permanent retirement of 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express.
[3] The fourth quarter, third quarter, second quarter and first quarter of 2019 include $84 million, $69 million, $114 million and $121 million, respectively, of TNT Express integration expenses (including any restructuring charges). The fourth quarter and third quarter of 2019 include business realignment costs of $316 million and $4 million, respectively. The fourth quarter includes a net loss of $3.9 billion related to the annual MTM retirement plans accounting adjustment. The second quarter of 2019 includes costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
[4] The third quarter of 2019 includes a tax benefit of $90 million from the reduction of a valuation allowance on certain tax loss carryforwards and a tax expense of $50 million related to a lower tax rate in the Netherlands applied to our deferred tax balances. The second quarter of 2019 includes a tax benefit of approximately $60 million from accelerated deductions claimed on our 2018 U.S. income tax return. In addition, we recognized a tax expense of $4 million in the second quarter of 2019 as a revision of the provisional benefit associated with the remeasurement of our net U.S. deferred tax liability upon completion of the accounting for the tax effects of the TCJA.
[5] Relates to the adoption of Accounting Standards Update (“ASU”) 2016-02 and ASU 2018-02
[6] Relates to the adoption of ASU 2018-02.
v3.20.2
Consolidated Statements of Changes in Common Stockholders' Investment (Parenthetical) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Statement Of Stockholders Equity [Abstract]      
Other comprehensive loss, tax $ (43) $ (57) $ (21)
Purchase of treasury stock 20,000.00 6,600,000 4,300,000
Cash dividends declared, per share $ 2.60 $ 2.60 $ 2.00
Employee incentive plans and other, shares issued 1,000,000.0 1,300,000 3,100,000
v3.20.2
Description of Business Segments and Summary of Significant Accounting Policies
 12 Months Ended
May 31, 2020
Accounting Policies [Abstract]  
Description of Business Segments and Summary of Significant Accounting Policies

NOTE 1: DESCRIPTION OF BUSINESS SEGMENTS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

DESCRIPTION OF BUSINESS SEGMENTS. FedEx Corporation (“FedEx”) provides a broad portfolio of transportation, e-commerce and business services through companies competing collectively, operating independently and managed collaboratively, under the respected FedEx brand. Our primary operating companies are Federal Express Corporation (“FedEx Express”), the world’s largest express transportation company; FedEx Ground Package System, Inc. (“FedEx Ground”), a leading North American provider of small-package ground delivery services; and FedEx Freight Corporation (“FedEx Freight”), a leading North American provider of less-than-truckload (“LTL”) freight transportation. These companies represent our major service lines and, along with FedEx Corporate Services, Inc. (“FedEx Services”), constitute our reportable segments. Our FedEx Services segment provides sales, marketing, information technology, communications, customer service, technical support, billing and collection services, and certain back-office functions that support our transportation segments (FedEx Express, FedEx Ground and FedEx Freight) and other business units.

FISCAL YEARS. Except as otherwise specified, references to years indicate our fiscal year ended May 31, 2020 or ended May 31 of the year referenced.

RECLASSIFICATIONS. Certain reclassifications have been made to the prior years’ consolidated financial statements to conform to the current year’s presentation.

PRINCIPLES OF CONSOLIDATION. The consolidated financial statements include the accounts of FedEx and its subsidiaries, substantially all of which are wholly owned. All significant intercompany accounts and transactions have been eliminated in consolidation.

REVENUE RECOGNITION. 

Satisfaction of Performance Obligation

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the basis of revenue recognition in accordance with U.S. generally accepted accounting principles (“GAAP”). To determine the proper revenue recognition method for contracts, we evaluate whether two or more contracts should be combined and accounted for as one single contract and whether the combined or single contract should be accounted for as more than one performance obligation. For most of our contracts, the customer contracts with us to provide distinct services within a single contract, primarily transportation services. Substantially all of our contracts with customers for transportation services include only one performance obligation, the transportation services themselves. However, if a contract is separated into more than one performance obligation, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. We frequently sell standard transportation services with observable standalone sales prices. In these instances, the observable standalone sales are used to determine the standalone selling price.

For transportation services, revenue is recognized over time as we perform the services in the contract because of the continuous transfer of control to the customer. Our customers receive the benefit of our services as the goods are transported from one location to another. If we were unable to complete delivery to the final location, another entity would not need to reperform the transportation service already performed. As control transfers over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the products or services to be provided. We use the cost-to-cost measure of progress for our package delivery contracts because it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenue, including ancillary or accessorial fees and reductions for estimated customer incentives, is recorded proportionally as costs are incurred. Costs to fulfill include labor and other direct costs and an allocation of indirect costs. For our freight and freight forwarding contracts, an output method of progress based on time-in-transit is utilized as the timing of costs incurred does not best depict the transfer of control to the customer.

We also provide customized customer-specific solutions, such as supply chain management solutions and inventory and service parts logistics, through which we provide the service of integrating a complex set of tasks and components into a single capability. For these arrangements, the majority of which are conducted by our FedEx Logistics, Inc. (“FedEx Logistics”) operating segment, the entire contract is accounted for as one performance obligation. For these performance obligations, we typically have a right to consideration from customers in an amount that corresponds directly with the value to the customers of our performance completed to date, and as such we recognize revenue in the amount to which we have a right to invoice the customer.

Contract Modification

Contracts are often modified to account for changes in the rates we charge our customers or to add additional distinct services. We consider contract modifications to exist when the modification either creates new enforceable rights and obligations or alters the existing arrangement. Contract modifications that add distinct goods or services are treated as separate contracts. Contract modifications that do not add distinct goods or services typically change the price of existing services. These contract modifications are accounted for prospectively as the remaining performance obligations are distinct.

Variable Consideration

Certain contracts contain customer incentives, guaranteed service refunds and other provisions that can either increase or decrease the transaction price. These incentives are generally awarded based upon achieving certain performance metrics. We estimate variable consideration as the most likely amount to which we expect to be entitled. We include estimated amounts of revenue, which may be reduced by incentives or other contract provisions, in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based on an assessment of anticipated customer spending and all information (historical, current and forecasted) that is reasonably available to us.

Principal vs. Agent Considerations

Transportation services are provided with the use of employees and independent businesses that contract with FedEx. GAAP requires us to evaluate whether our businesses themselves promise to transfer services to the customer (as the principal) or to arrange for services to be provided by another party (as the agent) using a control model. Based on our evaluation of the control model, we determined that FedEx is the principal to the transaction for most of these services and revenue is recognized on a gross basis based on the transfer of control to the customer. Costs associated with independent businesses providing transportation services are recognized as incurred and included in the caption “Purchased transportation” in the accompanying consolidated statements of income.

Our contract logistics, global trade services and certain transportation businesses engage in certain transactions wherein they act as agents. Revenue from these transactions is recorded on a net basis. Net revenue includes billings to customers less third-party charges, including transportation or handling costs, fees, commissions and taxes and duties.

Contract Assets and Liabilities

Contract assets include billed and unbilled amounts resulting from in-transit shipments, as we have an unconditional right to payment only once all performance obligations have been completed (e.g., packages have been delivered). Contract assets are generally classified as current and the full balance is converted each quarter based on the short-term nature of the transactions. Our contract liabilities consist of advance payments and billings in excess of revenue. The full balance of deferred revenue is converted each quarter based on the short-term nature of the transactions.

Gross contract assets related to in-transit shipments totaled $563 million and $533 million at May 31, 2020 and May 31, 2019, respectively. Contract assets, net of deferred unearned revenue were $456 million and $364 million at May 31, 2020 and May 31, 2019, respectively. Contract assets are included within current assets in the accompanying consolidated balance sheets. Contract liabilities related to advance payments from customers were $10 million and $11 million at May 31, 2020 and May 31, 2019, respectively. Contract liabilities are included within current liabilities in the accompanying consolidated balance sheets.

Payment terms

Certain of our revenue-producing transactions are subject to taxes, such as sales tax, assessed by governmental authorities. We present these revenues net of tax. Under the typical payment terms of our customer contracts, the customer pays at periodic intervals (e.g., every 15 days, 30 days, 45 days, etc.) for shipments included on invoices received. It is not customary business practice to extend payment terms past 90 days, and as such, we do not have a practice of including a significant financing component within our revenue contracts with customers.

Disaggregation of Revenue

See Note 14 for disclosure of disaggregated revenue for the periods ended May 31. This presentation is consistent with how we organize our segments internally for making operating decisions and measuring performance.

CREDIT RISK. We routinely grant credit to many of our customers for transportation and business services without collateral. The risk of credit loss in our trade receivables is substantially mitigated by our credit evaluation process, short collection terms and sales to a large number of customers, as well as the low revenue per transaction for most of our services. Allowances for potential credit losses are determined based on historical experience and the impact of current economic conditions. Historically, credit losses have been within management’s expectations.

ADVERTISING. Advertising and promotion costs are expensed as incurred and are classified in other operating expenses. Advertising and promotion expenses were $427 million in 2020, $468 million in 2019 and $442 million in 2018.

CASH EQUIVALENTS. Cash in excess of current operating requirements is invested in short-term, interest-bearing instruments with maturities of three months or less at the date of purchase and is stated at cost, which approximates market value.

SPARE PARTS, SUPPLIES AND FUEL. Spare parts (principally aircraft-related) are reported at weighted-average cost. Allowances for obsolescence are provided for spare parts currently identified as excess or obsolete as well as expected to be on hand at the date the aircraft are retired from service. These allowances are provided over the estimated useful life of the related aircraft and engines. The majority of our supplies and fuel are reported at weighted-average cost.

PROPERTY AND EQUIPMENT. Expenditures for major additions, improvements and flight equipment modifications are capitalized when such costs are determined to extend the useful life of the asset or are part of the cost of acquiring the asset. Expenditures for equipment overhaul costs of engines or airframes prior to their operational use are capitalized as part of the cost of such assets as they are costs required to ready the asset for its intended use. Maintenance and repairs costs are charged to expense as incurred, except for certain aircraft engine maintenance costs incurred under third-party service agreements. These agreements result in costs being expensed based on cycles or hours flown and are subject to annual escalation. These service contracts transfer risk to third-party service providers and generally fix the amount we pay for maintenance to the service provider as a rate per cycle or flight hour, in exchange for maintenance and repairs under a predefined maintenance program. We capitalize certain direct internal and external costs associated with the development of internal-use software. Gains and losses on sales of property used in operations are classified within operating expenses and historically have been nominal.

For financial reporting purposes, we record depreciation and amortization of property and equipment on a straight-line basis over the asset’s service life or related lease term, if shorter. For income tax purposes, depreciation is computed using accelerated methods when applicable.

The depreciable lives and net book value of our property and equipment are as follows (dollars in millions):

 

 

 

 

 

Net Book Value at May 31,

 

 

 

Range

 

2020

 

 

2019

 

Wide-body aircraft and related equipment

 

15 to 30 years

 

$

13,448

 

 

$

11,975

 

Narrow-body and feeder aircraft and related equipment

 

5 to 18 years

 

 

2,478

 

 

 

2,696

 

Package handling and ground support equipment

 

3 to 30 years

 

 

4,499

 

 

 

4,157

 

Information technology

 

2 to 10 years

 

 

1,795

 

 

 

1,553

 

Vehicles and trailers

 

3 to 15 years

 

 

4,345

 

 

 

4,042

 

Facilities and other

 

2 to 40 years

 

 

7,043

 

 

 

6,006

 

 

Substantially all property and equipment have no material residual values. The majority of aircraft costs are depreciated on a straight-line basis over 15 to 30 years. We periodically evaluate the estimated service lives and residual values used to depreciate our property and equipment. 

Depreciation and amortization expense, excluding gains and losses on sales of property and equipment used in operations, was $3.6 billion in 2020, $3.4 billion in 2019 and $3.1 billion in 2018. Depreciation and amortization expense includes amortization of assets under finance lease.

CAPITALIZED INTEREST. Interest on funds used to finance the acquisition and modification of aircraft, including purchase deposits, construction of certain facilities, and development of certain software up to the date the asset is ready for its intended use, is capitalized and included in the cost of the asset if the asset is actively under construction. Capitalized interest was $54 million in 2020, $64 million in 2019 and $61 million in 2018.

IMPAIRMENT OF LONG-LIVED ASSETS. Long-lived assets are reviewed for impairment when circumstances indicate the carrying value of an asset may not be recoverable. For assets that are to be held and used, an impairment is recognized when the estimated undiscounted cash flows associated with the asset or group of assets is less than their carrying value. If impairment exists, an adjustment is made to write the asset down to its fair value, and a loss is recorded as the difference between the carrying value and fair value. Fair values are determined based on quoted market values, discounted cash flows or internal and external appraisals, as applicable. Assets to be disposed of are carried at the lower of carrying value or estimated net realizable value.

We operate integrated transportation networks so cash flows for most of our operating assets to be held and used are assessed at a network level, not at an individual asset level, for our analysis of impairment.

In the second quarter of 2020, we made the decision to permanently retire from service 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express to align with the needs of the U.S. domestic network and modernize its aircraft fleet. As a consequence of this decision, we recognized noncash impairment charges of $66 million ($50 million, net of tax, or $0.19 per diluted share) in the FedEx Express segment in the second quarter of 2020. Seven of these aircraft had been temporarily idled.

In the normal management of our aircraft fleet, we routinely idle aircraft and engines temporarily due to maintenance cycles and adjustments of our network capacity to match seasonality and overall customer demand levels. Temporarily idled assets are classified as available-for-use, and we continue to record depreciation expense associated with these assets. These temporarily idled assets are assessed for impairment and remaining life on a quarterly basis. The criteria for determining whether an asset has been permanently removed from service (and, as a result, is potentially impaired) include, but are not limited to, our global economic outlook and the impact of our outlook on our current and projected volume levels, including capacity needs during our peak shipping seasons; the introduction of new fleet types or decisions to permanently retire an aircraft fleet from operations; and changes to planned service expansion activities. At May 31, 2020, we had 14 aircraft temporarily idled. These aircraft have been idled for an average of five months and are expected to return to revenue service.

SALE OF BUSINESS. During 2018, we sold a non-core business of TNT Express B.V. (“TNT Express”) and recorded a gain of $85 million in the FedEx Express segment.

GOODWILL. Goodwill is recognized for the excess of the purchase price over the fair value of tangible and identifiable intangible net assets of businesses acquired. Several factors give rise to goodwill in our acquisitions, such as the expected benefits from synergies of the combination and the existing workforce of the acquired business. Goodwill is reviewed at least annually for impairment. In our evaluation of goodwill impairment, we perform a qualitative assessment to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the qualitative assessment is not conclusive, we proceed to test goodwill for impairment, including comparing the fair value of the reporting unit to its carrying value (including attributable goodwill). Fair value for our reporting units is determined using an income or market approach incorporating market participant considerations and management’s assumptions on revenue growth rates, operating margins, discount rates and expected capital expenditures. Fair value determinations may include both internal and third-party valuations. Unless circumstances otherwise dictate, we perform our annual impairment testing in the fourth quarter.

See Note 4 for additional information.

INTANGIBLE ASSETS. Intangible assets primarily include customer relationships, technology assets and trademarks acquired in business combinations. Intangible assets are amortized over periods ranging from 3 to 15 years, either on a straight-line basis or on a basis consistent with the pattern in which the economic benefits are realized.

PENSION AND POSTRETIREMENT HEALTHCARE PLANS. Our defined benefit pension and other postretirement benefit plans are measured using actuarial techniques that reflect management’s assumptions for discount rate, investment returns on plan assets, salary increases, expected retirement, mortality, employee turnover and future increases in healthcare costs. We determine the discount rate (which is required to be the rate at which the projected benefit obligation (“PBO”) could be effectively settled as of the measurement date) with the assistance of actuaries, who calculate the yield on a theoretical portfolio of high-grade corporate bonds (rated Aa or better) with cash flows that are designed to match our expected benefit payments in future years. We use the fair value of plan assets to calculate the expected return on assets (“EROA”) for interim and segment reporting purposes. Our EROA is a judgmental estimate which is reviewed on an annual basis and revised as appropriate.

The accounting guidance related to employers’ accounting for defined benefit pension and other postretirement plans requires recognition in the balance sheet of the funded status of these plans. We use “mark-to-market” or MTM accounting and immediately recognize changes in the fair value of plan assets and actuarial gains or losses in our results annually in the fourth quarter each year. The annual MTM adjustment is recognized at the corporate level and does not impact segment results. The remaining components of pension and postretirement healthcare expense, primarily service and interest costs and the EROA, are recorded on a quarterly basis. Only service cost is recognized in segment level operating results.

INCOME TAXES. Deferred income taxes are provided for the tax effect of temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements. The liability method is used to account for income taxes, which requires deferred taxes to be recorded at the statutory rate expected to be in effect when the taxes are paid.

Deferred income tax assets represent amounts available to reduce income taxes payable on taxable income in future years. Such assets arise because of temporary differences between the financial reporting and tax bases of assets and liabilities, as well as from net operating loss and tax credit carryforwards. We evaluate the recoverability of these future tax deductions and credits by assessing the adequacy of future expected taxable income from all sources, including reversal of taxable temporary differences, forecasted operating earnings and available tax planning strategies. These sources of income rely heavily on estimates to make this determination and, thus, there is a risk that these estimates will have to be revised as new information is received. To the extent we do not consider it more likely than not that a deferred tax asset will be recovered, a valuation allowance is established. We believe we will generate sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets in our consolidated balance sheets that are not subject to valuation allowances. We record the taxes for global intangible low-taxed income as a period cost.

We recognize liabilities for uncertain income tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step requires us to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as we must determine the probability of various possible outcomes. We reevaluate these uncertain tax positions on a quarterly basis or when new information becomes available to management. These reevaluations are based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, successfully settled issues under audit and new audit activity. Such a change in recognition or measurement could result in the recognition of a tax benefit or an increase to the related provision.

We classify interest related to income tax liabilities as interest expense, and if applicable, penalties are recognized as a component of income tax expense. The income tax liabilities and accrued interest and penalties that are due within one year of the balance sheet date are presented as current liabilities. The noncurrent portion of our income tax liabilities and accrued interest and penalties are recorded in the caption “Other liabilities” in the accompanying consolidated balance sheets.

SELF-INSURANCE ACCRUALS. We are self-insured for costs associated with workers’ compensation claims, vehicle accidents and general business liabilities, and benefits paid under employee healthcare and disability programs. Accruals are primarily based on the actuarially estimated cost of claims, which includes incurred-but-not-reported claims. Current workers’ compensation claims, vehicle and general liability, employee healthcare claims and long-term disability are included in accrued expenses. We self-insure up to certain limits that vary by operating company and type of risk. Periodically, we evaluate the level of insurance coverage and adjust insurance levels based on risk tolerance and premium expense.

LEASES. We lease certain facilities, aircraft, equipment and vehicles under operating and finance leases. A determination of whether a contract contains a lease is made at the inception of the arrangement. Our leased facilities include national, regional and metropolitan sorting facilities, retail facilities and administrative buildings.

Our leases generally contain options to extend or terminate the lease. We reevaluate our leases on a regular basis to consider the economic and strategic incentives of exercising the renewal options, and how they align with our operating strategy. Therefore, substantially all the renewal option periods are not included within the lease term and the associated payments are not included in the measurement of the right-of-use asset and lease liability as the options to extend are not reasonably certain at lease commencement.

The lease liabilities are measured at the lease commencement date and determined using the present value of the minimum lease payments not yet paid and our incremental borrowing rate, which approximates the rate at which we would borrow, on a collateralized basis, over the term of a lease in the applicable currency environment. The interest rate implicit in the lease is generally not determinable in transactions where we are the lessee.

For real estate leases, we account for lease components and non-lease components (such as common area maintenance) as a single lease component. Certain real estate leases require additional payments based on sales volume and index-based rate increases, as well as reimbursement for real estate taxes, common area maintenance and insurance, which are expensed as incurred as variable lease costs. Certain leases contain fixed lease payments for items such as real estate taxes, common area maintenance and insurance. These fixed payments are considered part of the lease payment and included in the right-of-use assets and lease liabilities.

See Note 7 for additional information.

DEFERRED GAINS. Prior to the adoption of ASU 2016-02 on June 1, 2019, gains on the sale and leaseback of aircraft and other property and equipment were deferred and amortized ratably over the life of the lease as a reduction of rent expense. Substantially all of these deferred gains, which are included in other non-current liabilities, related to aircraft transactions.

DERIVATIVE FINANCIAL INSTRUMENTS. Our risk management strategy includes the select use of derivative instruments to reduce the effects of volatility in foreign currency exchange exposure on operating results and cash flows. In accordance with our risk management policies, we do not hold or issue derivative instruments for trading or speculative purposes. All derivative instruments are recognized in the financial statements at fair value, regardless of the purpose or intent for holding them.

When we become a party to a derivative instrument and intend to apply hedge accounting, we formally document the hedge relationship and the risk management objective for undertaking the hedge, which includes designating the instrument for financial reporting purposes as a fair value hedge, a cash flow hedge, or a net investment hedge.

If a derivative is designated as a cash flow hedge, the entire change in the fair value of the hedging instrument included in the assessment of hedge effectiveness is recorded in other comprehensive income. For net investment hedges, the entire change in the fair value is recorded in other comprehensive income. Any portion of a change in the fair value of a derivative that is considered to be ineffective, along with the change in fair value of any derivatives not designated in a hedging relationship, is immediately recognized in the income statement. We do not have any derivatives designated as a cash flow hedge for any period presented. During 2020, we designated €392 million of debt as a net investment hedge to reduce the volatility of the U.S. dollar value of a portion of our net investment in a euro-denominated consolidated subsidiary. As of May 31, 2020, the hedge remains effective.

FOREIGN CURRENCY TRANSLATION. Translation gains and losses of foreign operations that use local currencies as the functional currency are accumulated and reported, net of applicable deferred income taxes, as a component of Accumulated Other Comprehensive Income (“AOCI”) within common stockholders’ investment. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the local currency are included in the caption “Other, net” in the accompanying consolidated statements of income and were immaterial for each period presented.

EMPLOYEES UNDER COLLECTIVE BARGAINING ARRANGEMENTS. The pilots of FedEx Express, who are a small number of its total employees, are employed under a collective bargaining agreement that took effect on November 2, 2015. The collective bargaining agreement is scheduled to become amendable in November 2021. Other than the pilots at FedEx Express, a small number of our employees are members of unions.

STOCK-BASED COMPENSATION. The accounting guidance related to share-based payments requires recognition of compensation expense for stock-based awards using a fair value method. We use the Black-Scholes option pricing model to calculate the fair value of stock options. The value of restricted stock awards is based on the stock price of the award on the grant date. We record stock-based compensation expense in the “Salaries and employee benefits” caption in the accompanying consolidated statements of income. We issue new shares or treasury shares from stock repurchases to cover employee stock option exercises and restricted stock grants.

TREASURY SHARES. In January 2016, our Board of Directors authorized a stock repurchase program of up to 25 million shares. During 2020, we repurchased 0.02 million shares of FedEx common stock at an average price of $156.90 per share for a total of $3 million. As of May 31, 2020, 5.1 million shares remained under the stock repurchase authorization. Shares under the current repurchase program may be repurchased from time to time in the open market or in privately negotiated transactions. The timing and volume of repurchases are at the discretion of management, based on the capital needs of the business, the market price of FedEx common stock and general market conditions. No time limit was set for the completion of the program, and the program may be suspended or discontinued at any time.

In 2019, we repurchased 6.6 million shares of FedEx common stock at an average price of $222.94 per share for a total of $1.5 billion. In 2018, we repurchased 4.3 million shares of FedEx common stock at an average price of $237.45 per share for a total of $1.0 billion.

During the fourth quarter of 2020, we amended our amended and restated $2.0 billion five-year credit agreement (the “Five-Year Credit Agreement”) and our $1.5 billion 364-day credit agreement (the “364-Day Credit Agreement” and together with the Five-Year Credit Agreement, the “Credit Agreements”). The amendments to the Credit Agreements, among other things, temporarily restrict us from repurchasing any shares of our common stock between May 27, 2020 and May 31, 2021. See Note 6 for more information on the amendments to the Credit Agreements.

DIVIDENDS DECLARED PER COMMON SHARE. On June 15, 2020, our Board of Directors declared a quarterly dividend of $0.65 per share of common stock. The dividend was paid on July 13, 2020 to stockholders of record as of the close of business on June 29, 2020. Each quarterly dividend payment is subject to review and approval by our Board of Directors, and we evaluate our dividend payment amount on an annual basis. The amendments to the Credit Agreements discussed above under “Treasury Shares” temporarily restrict us from increasing the amount of our quarterly dividend payable per share of common stock from $0.65 per share between May 27, 2020 and May 31, 2021. There are no other material restrictions on our ability to declare dividends, nor are there any material restrictions on the ability of our subsidiaries to transfer funds to us in the form of cash dividends, loans or advances.

BUSINESS REALIGNMENT COSTS. During 2019, we conducted a program to offer voluntary cash buyouts to eligible U.S.-based employees in certain staff functions. As a result of this program, approximately 1,500 employees left the Company. Costs of the benefits provided under the U.S.-based voluntary employee buyout program were recognized in 2019 when eligible employees accepted their offers. Payments under this program were made at the time of departure and totaled approximately $50 million in 2020 and $220 million in 2019.

USE OF ESTIMATES. The preparation of our consolidated financial statements requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of revenue and expenses and the disclosure of contingent liabilities. Management makes its best estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Changes in estimates are recognized in accordance with the accounting rules for the estimate, which is typically in the period when new information becomes available to management. Areas where the nature of the estimate makes it reasonably possible that actual results could materially differ from amounts estimated include: self-insurance accruals; retirement plan obligations; long-term incentive accruals; tax liabilities; loss contingencies; litigation claims; impairment assessments on long-lived assets (including goodwill); and that rely on projections of future cash flows and purchase price allocations.

The new strain of coronavirus (“COVID-19”) in 2020 and the efforts to contain it have negatively impacted the global economy, disrupted manufacturing operations and global supply chains and created significant volatility and disruption of financial markets. In addition, the COVID-19 pandemic has significantly increased economic and demand uncertainty. See Item 7 (“Management’s Discussion and Analysis of Results of Operations and Financial Condition”) of this Annual Report on Form 10-K for more information about the COVID-19 pandemic and its effects on our business, results of operations and financial condition. The Company believes the estimates and assumptions underlying our financial statements are reasonable and supportable based on the information available at the time the financial statements were prepared. However, uncertainty over the impact COVID-19 will have on the global economy and our business in particular makes many of the estimates and assumptions reflected in our 2020 consolidated financial statements inherently less certain. Therefore, actual results may ultimately differ from those estimates to a greater degree than historically.

v3.20.2
Recent Accounting Guidance
 12 Months Ended
May 31, 2020
New Accounting Pronouncements And Changes In Accounting Principles [Abstract]  
Recent Accounting Guidance

NOTE 2: RECENT ACCOUNTING GUIDANCE

New accounting rules and disclosure requirements can significantly impact our reported results and the comparability of our financial statements. We believe the following new accounting guidance is relevant to the readers of our financial statements.

Recently Adopted Accounting Standards

In 2016, the Financial Accounting Standards Board (“FASB”) issued a new lease accounting standard, which requires lessees to put most leases on their balance sheets but recognize the expenses in their income statements in a manner similar to current practice. Lessees are required to recognize a lease liability for the obligation to make lease payments and a right-of-use asset for the right to use the underlying asset for the lease term. Expenses related to leases determined to be operating leases are recognized on a straight-line basis, while those determined to be finance leases are recognized following a front-loaded expense profile in which interest and amortization are presented separately in the income statement.  

We adopted this new standard on June 1, 2019 using a modified retrospective transition method. Under this approach, we did not adjust the balance sheet for comparative periods but recorded a cumulative effect adjustment to retained earnings on June 1, 2019. We have elected the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allows us to carry forward the historical accounting relating to lease identification and classification for existing leases upon adoption. We also elected the practical expedient to not separate lease and non-lease components for the majority of our classes of assets. For leases in which the lease and non-lease components have been combined, the lease expense includes expenses such as common area maintenance. We have made an accounting policy election not to recognize leases with an initial term of 12 months or less on the consolidated balance sheet.  

The adoption of the new lease accounting standard resulted in the recognition of an operating lease liability of $14.2 billion and an operating right-of-use asset of $14.1 billion, with an immaterial impact on our income statement compared to the previous lease accounting model. Existing prepaid asset and net deferred rent liability balances of $154 million and $309 million, respectively, were recorded to the right-of-use asset. The cumulative effect of the adoption to retained earnings was an increase of $57 million ($47 million, net of tax), primarily related to the reclassification of deferred gains related to sale-leasebacks of aircraft. Substantially all of our lease arrangements are operating leases under the new standard. The new standard had a material impact on our balance sheet but did not materially impact consolidated operating results and had no impact on operating cash flows.

See Note 1 “Leases” and Note 7 for additional information.

In February 2018, the FASB issued ASU 2018-02 that permits companies to reclassify the income tax effect of the Tax Cuts and Jobs Act (“TCJA”) on items within AOCI to retained earnings. We adopted this new standard on June 1, 2019.

In March 2020, the Securities and Exchange Commission (“SEC”) amended Rule 3-10 of Regulation S-X regarding financial disclosure requirements for registered debt offerings involving subsidiaries as either issuers or guarantors and affiliates whose securities are pledged as collateral. This new guidance narrows the circumstances that require separate financial statements of subsidiary issuers and guarantors and streamlines the alternative disclosures required in lieu of those statements. This rule is effective January 4, 2021 (fiscal 2021) with earlier adoption permitted. We adopted this new standard in the fourth quarter of 2020. Accordingly, summarized financial information has been presented only for the issuer and guarantors of the Company’s registered debt securities for the most recent fiscal year, and the location of the required disclosures has been moved outside the Notes to Consolidated Financial Statements and is provided in the “Financial Condition—Guarantor Financial Information” section of “Management’s Discussion and Analysis of Results of Operations and Financial Condition.”

New Accounting Standards and Accounting Standards Not Yet Adopted

In June 2016, the FASB issued ASU 2016-13 that changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. We adopted this standard effective June 1, 2020 (fiscal 2021). This standard will not have a material impact on our consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU 2018-15 that reduces the complexity of accounting for costs of implementing a cloud computing service arrangement and aligns the accounting for capitalizing implementation costs of hosting arrangements, regardless of whether they convey a license to the hosted software. We adopted this standard effective June 1, 2020 (fiscal 2021) and applied these changes prospectively. This standard will not have a material impact on our consolidated financial statements and related disclosures.

In December 2019, the FASB issued ASU 2019-12, which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This standard is effective June 1, 2021 (fiscal 2022). We adopted this standard effective June 1, 2020 (fiscal 2021). This new standard will not have a material impact on our consolidated financial statements and related disclosures.
v3.20.2
Business Combinations
 12 Months Ended
May 31, 2020
Business Combinations [Abstract]  
Business Combinations

NOTE 3: BUSINESS COMBINATIONS

On May 1, 2019, we acquired the international express division of FC (Flying Cargo) Express Ltd. (“Flying Cargo”) for $67 million in cash from operations. The majority of the purchase price was allocated to goodwill. The financial results of this acquired business are included in the FedEx Express segment from the date of acquisition and were not material to our results of operations. Therefore, pro forma financial information has not been provided.

On October 1, 2018, we acquired the controlling interest in an existing joint venture with Swiss Post, which operates a Swiss-wide transport system with connections to TNT Express’s global network. The controlling interest was acquired through the noncash contribution of a complementary Swiss business into the venture, resulting in the recognition of an immaterial gain. The majority of the purchase price was allocated to goodwill and other intangibles. The financial results of this acquired business are included in the FedEx Express segment from the date of acquisition and were not material to our results of operations. Therefore, pro forma financial information has not been provided. 

On March 23, 2018, we acquired P2P Mailing Limited, a leading provider of worldwide, low-cost e-commerce transportation solutions, for £92 million ($135 million) in cash from operations. The majority of the purchase price was allocated to goodwill. The financial results of this acquired business are included in the FedEx Logistics operating segment from the date of acquisition and were not material to our results of operations. Therefore, pro forma financial information has not been provided.

On October 13, 2017, we acquired Northwest Research, Inc., a leader in inventory research and management, for $50 million in cash from operations. The majority of the purchase price was allocated to property and equipment. The financial results of this acquired business are included in the FedEx Services segment from the date of acquisition and were not material to our results of operations. Therefore, pro forma financial information has not been provided.
v3.20.2
Goodwill and Other Intangible Assets
 12 Months Ended
May 31, 2020
Goodwill And Intangible Assets Disclosure [Abstract]  
Goodwill And Other Intangible Assets

NOTE 4: GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL. The carrying amount of goodwill attributable to each reportable operating segment and changes therein are as follows (in millions):

 

 

 

FedEx Express

Segment

 

 

FedEx Ground

Segment

 

 

FedEx Freight

Segment

 

 

Corporate, Other and Eliminations

 

 

Total

 

Goodwill at May 31, 2018

 

$

5,100

 

 

$

840

 

 

$

767

 

 

$

1,950

 

 

$

8,657

 

Accumulated impairment charges

 

 

—

 

 

 

—

 

 

 

(133

)

 

 

(1,551

)

 

 

(1,684

)

Balance as of May 31, 2018

 

 

5,100

 

 

 

840

 

 

 

634

 

 

 

399

 

 

 

6,973

 

Goodwill acquired(1)

 

 

126

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

126

 

Other(2)

 

 

(210

)

 

 

—

 

 

 

—

 

 

 

(5

)

 

 

(215

)

Balance as of May 31, 2019

 

 

5,016

 

 

 

840

 

 

 

634

 

 

 

394

 

 

 

6,884

 

Impairment charges

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(358

)

 

 

(358

)

Other(2)

 

 

(147

)

 

 

—

 

 

 

—

 

 

 

(7

)

 

 

(154

)

Balance as of May 31, 2020

 

$

4,869

 

 

$

840

 

 

$

634

 

 

$

29

 

 

$

6,372

 

Accumulated goodwill impairment charges

   as of May 31, 2020

 

$

—

 

 

$

—

 

 

$

(133

)

 

$

(1,909

)

 

$

(2,042

)

 

(1)

Goodwill acquired relates to the acquisitions of Flying Cargo and the controlling interest in an existing joint venture with Swiss Post. See Note 3 for more information.

(2)

Primarily currency translation adjustments, purchase price allocation-related adjustments, and acquired goodwill related to immaterial acquisitions.

We recorded an impairment charge of $358 million attributable to our FedEx Office and Print Services, Inc. (“FedEx Office”) and FedEx Supply Chain Distribution System, Inc. (“FedEx Supply Chain”) reporting units in the fourth quarter of 2020. The COVID-19 pandemic resulted in store closures and declining print revenue at FedEx Office during the fourth quarter of 2020 and is expected to continue to negatively impact its near-term operating performance. Based on these factors, our outlook for the FedEx Office business and retail industry changed in the fourth quarter of 2020, which contributed $348 million to the goodwill impairment charge.

While there are several factors negatively impacting near-term results at FedEx Express, including weak global economic conditions and the timing and amount of TNT Express integration program expenses, FedEx Express continues to be an established profitable business with a fair value that exceeds its carrying value based on our valuation performed during the fourth quarter of 2020. In addition, our other reporting units with significant recorded goodwill include FedEx Ground and FedEx Freight. We evaluated these reporting units during the fourth quarters of 2020 and 2019. The estimated fair value of each of these reporting units significantly exceeded their carrying values as of the end of 2020 and 2019; therefore, we do not believe that any of these reporting units were impaired as of the balance sheet dates. No impairments of goodwill were recognized in 2019.

In 2018, we incurred a goodwill impairment charge of $374 million related to FedEx Supply Chain, eliminating substantially all of the goodwill attributable to this reporting unit. In our evaluation of the goodwill of this reporting unit, we compared the fair value of the reporting unit to its carrying value (including attributable goodwill). Fair value was estimated using standard valuation methodologies (principally the income and market approach classified as Level 3 within the fair value hierarchy) incorporating market participant considerations and management’s assumptions on revenue growth rates, operating margins, discount rates and expected capital expenditures. The key factors contributing to the goodwill impairment were underperformance of the FedEx Supply Chain business during 2018, including base business erosion, and the failure to attain the level of operating synergies and revenue and profit growth anticipated at the time of the acquisition. Based on these factors, our outlook for the business and industry changed in the fourth quarter of 2018.

OTHER INTANGIBLE ASSETS. The summary of our intangible assets and related accumulated amortization at May 31, 2020 and 2019 is as follows (in millions):

 

 

 

2020

 

 

2019

 

 

 

Gross

Carrying

Amount

 

 

Accumulated

Amortization

 

 

Net Book

Value

 

 

Gross

Carrying

Amount

 

 

Accumulated

Amortization

 

 

Net Book

Value

 

Customer relationships

 

$

641

 

 

$

(327

)

 

$

314

 

 

$

685

 

 

$

(293

)

 

$

392

 

Technology

 

 

65

 

 

 

(57

)

 

 

8

 

 

 

66

 

 

 

(51

)

 

 

15

 

Trademarks and other

 

 

132

 

 

 

(132

)

 

 

—

 

 

 

137

 

 

 

(128

)

 

 

9

 

Total

 

$

838

 

 

$

(516

)

 

$

322

 

 

$

888

 

 

$

(472

)

 

$

416

 

 

Amortization expense for intangible assets was $66 million in 2020, $82 million in 2019 and $87 million in 2018.

Expected amortization expense for the next five years is as follows (in millions):

 

2021

$

49

 

2022

 

43

 

2023

 

40

 

2024

 

39

 

2025

 

38

 

 
v3.20.2
Selected Current Liabilities
 12 Months Ended
May 31, 2020
Accounts Payable And Accrued Liabilities Fair Value Disclosure [Abstract]  
Selected Current Liabilities

NOTE 5: SELECTED CURRENT LIABILITIES

The components of selected current liability captions at May 31 were as follows (in millions):

 

 

 

2020

 

 

2019

 

Accrued Salaries and Employee Benefits

 

 

 

 

 

 

 

 

Salaries

 

$

436

 

 

$

425

 

Employee benefits, including variable compensation

 

 

319

 

 

 

552

 

Compensated absences

 

 

814

 

 

 

764

 

 

 

$

1,569

 

 

$

1,741

 

Accrued Expenses

 

 

 

 

 

 

 

 

Self-insurance accruals

 

$

1,223

 

 

$

1,104

 

Taxes other than income taxes

 

 

417

 

 

 

304

 

Other

 

 

1,892

 

 

 

1,870

 

 

 

$

3,532

 

 

$

3,278

 

 
v3.20.2
Long-Term Debt and Other Financing Arrangements
 12 Months Ended
May 31, 2020
Debt And Capital Lease Obligations [Abstract]  
Long-term Debt and Other Financing Arrangements

NOTE 6: LONG-TERM DEBT AND OTHER FINANCING ARRANGEMENTS

The components of long-term debt (net of discounts and debt issuance costs), along with maturity dates for the years subsequent to May 31, 2020, are as follows (in millions):

 

 

 

 

 

 

 

 

 

May 31,

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

 

Interest Rate%

 

 

Maturity

 

 

 

 

 

 

 

 

Senior unsecured debt:

 

 

2.30

 

 

2020

 

$

—

 

 

$

400

 

 

 

 

3.40

 

 

2022

 

 

498

 

 

 

497

 

 

 

2.625-2.70

 

 

2023

 

 

748

 

 

 

747

 

 

 

 

4.00

 

 

2024

 

 

747

 

 

 

746

 

 

 

3.2-3.80

 

 

2025

 

 

1,687

 

 

 

696

 

 

 

 

3.25

 

 

2026

 

 

745

 

 

 

745

 

 

 

 

3.30

 

 

2027

 

 

446

 

 

 

446

 

 

 

 

3.40

 

 

2028

 

 

496

 

 

 

495

 

 

 

 

4.20

 

 

2029

 

 

397

 

 

 

396

 

 

 

3.1-4.25

 

 

2030

 

 

1,732

 

 

 

—

 

 

 

 

4.90

 

 

2034

 

 

495

 

 

 

495

 

 

 

 

3.90

 

 

2035

 

 

494

 

 

 

494

 

 

 

3.875-4.10

 

 

2043

 

 

984

 

 

 

984

 

 

 

 

5.10

 

 

2044

 

 

742

 

 

 

742

 

 

 

 

4.10

 

 

2045

 

 

641

 

 

 

641

 

 

 

4.55-4.75

 

 

2046

 

 

2,461

 

 

 

2,460

 

 

 

 

4.40

 

 

2047

 

 

735

 

 

 

735

 

 

 

 

4.05

 

 

2048

 

 

986

 

 

 

986

 

 

 

 

4.95

 

 

2049

 

 

835

 

 

 

835

 

 

 

 

5.25

 

 

2050

 

 

1,225

 

 

 

—

 

 

 

 

4.50

 

 

2065

 

 

246

 

 

 

246

 

 

 

 

7.60

 

 

2098

 

 

237

 

 

 

237

 

Euro senior unsecured debt:

 

 

0.50

 

 

2020

 

 

—

 

 

 

559

 

 

 

 

0.70

 

 

2022

 

 

695

 

 

 

713

 

 

 

 

1.00

 

 

2023

 

 

815

 

 

 

836

 

 

 

 

0.45

 

 

2026

 

 

541

 

 

 

—

 

 

 

 

1.625

 

 

2027

 

 

1,351

 

 

 

1,387

 

 

 

 

1.30

 

 

2032

 

 

539

 

 

 

—

 

Total senior unsecured debt

 

 

 

 

 

 

 

 

21,518

 

 

 

17,518

 

Other debt

 

 

 

 

 

 

 

 

—

 

 

 

1

 

Finance lease obligations

 

 

 

 

 

 

 

 

485

 

 

 

62

 

 

 

 

 

 

 

 

 

 

22,003

 

 

 

17,581

 

Less current portion

 

 

 

 

 

 

 

 

51

 

 

 

964

 

 

 

 

 

 

 

 

 

$

21,952

 

 

$

16,617

 

 

Interest on our U.S. dollar fixed-rate notes is paid semi-annually. Interest on our euro fixed-rate notes is paid annually. The weighted average interest rate on long-term debt was 3.6% as of May 31, 2020. Long-term debt, including current maturities and exclusive of finance leases, had estimated fair values of $22.8 billion at May 31, 2020 and $17.8 billion at May 31, 2019. The estimated fair values were determined based on quoted market prices and the current rates offered for debt with similar terms and maturities. The fair value of our long-term debt is classified as Level 2 within the fair value hierarchy. This classification is defined as a fair value determined using market-based inputs other than quoted prices that are observable for the liability, either directly or indirectly.

We have a shelf registration statement filed with the SEC that allows us to sell, in one or more future offerings, any combination of our unsecured debt securities and common stock.

During July 2019, we issued $2.1 billion of senior unsecured debt under our current shelf registration statement, comprised of $1.0 billion of 3.10% fixed-rate notes due in August 2029, €500 million of 0.45% fixed-rate notes due in August 2025 and €500 million of 1.30% fixed-rate notes due in August 2031. We used the net proceeds to make voluntary contributions to our tax-qualified U.S. domestic pension plans (“U.S. Pension Plans”) during the first quarter of 2020 and to redeem the $400 million aggregate principal amount of 2.30% notes due February 1, 2020 and the €500 million aggregate principal amount of 0.50% notes due April 9, 2020. The remaining net proceeds are being used for general corporate purposes.

On March 17, 2020, we entered into an amended and restated $2.0 billion Five-Year Credit Agreement and a $1.5 billion 364-Day Credit Agreement. The Five-Year Credit Agreement expires in March 2025 and includes a $250 million letter of credit sublimit. The 364-Day Credit Agreement expires in March 2021. The Credit Agreements are available to finance our operations and other cash flow needs.

On March 18, 2020, we elected to draw $1.5 billion under the 364-Day Credit Agreement to increase our cash position to preserve financial flexibility in light of disrupted access to commercial paper markets and uncertainty in the global financial markets resulting from the COVID-19 pandemic.

During April 2020, we issued $3.0 billion of senior unsecured debt under our current shelf registration statement, comprised of $1.0 billion of 3.80% fixed-rate notes due in May 2025, $750 million of 4.25% fixed-rate notes due in May 2030 and $1.25 billion of 5.25% fixed-rate notes due in May 2050. We used the net proceeds to repay the $1.5 billion of outstanding borrowings under the 364-Day Credit Agreement, repay $136 million of commercial paper outstanding under our commercial paper program and for general corporate purposes.

The Credit Agreements contain a financial covenant requiring us to maintain a ratio of debt to consolidated earnings (excluding noncash retirement plans MTM adjustments, noncash pension service costs and noncash asset impairment charges) before interest, taxes, depreciation and amortization (“adjusted EBITDA”) of not more than 3.5 to 1.0, calculated as of the end of the applicable quarter on a rolling four-quarters basis. On May 27, 2020, we amended the Credit Agreements to revise the adjusted EBITDA definition to exclude noncash pension service costs (as noted above) and to increase the ratio of debt to adjusted EBITDA as follows: 3.75:1.0 at May 31, 2020; 4.75:1.0 at August 31, 2020; 4.9:1.0 at November 30, 2020; 4.75:1.0 at February 28, 2021; and 3.75:1.0 at May 31, 2021, with the ratio reverting to 3.5:1.0 at August 31, 2021 and thereafter. The amendments to the Credit Agreements also contain temporary covenants restricting us from repurchasing any shares of our common stock or increasing the amount of our quarterly dividend payable per share of common stock from $0.65 per share between May 27, 2020 and May 31, 2021. The ratio of our debt to adjusted EBITDA was 3.0 to 1.0 at May 31, 2020.

We believe the covenants discussed above are the only significant restrictive covenant in the Credit Agreements. The Credit Agreements contain other customary covenants that do not, individually or in the aggregate, materially restrict the conduct of our business. We are in compliance with the financial covenant and all other covenants in the Credit Agreements and do not expect the covenants to affect our operations, including our liquidity or expected funding needs. If we failed to comply with the financial covenant or any other covenants in the Credit Agreements, our access to financing could become limited. We had $250 million of the letter of credit sublimit unused under our revolving credit facility as of May 31, 2020.

As of May 31, 2020, no commercial paper was outstanding.
v3.20.2
Leases
 12 Months Ended
May 31, 2020
Leases [Abstract]  
Leases

NOTE 7: LEASES

Disclosure Subsequent to the Adoption of the New Lease Accounting Standard (ASU 2016-02)

The following table is a summary of the components of net lease cost for the period ended May 31, 2020 (in millions):

 

 

 

2020

 

 

Operating lease cost(1)

 

$

2,668

 

 

Finance lease cost:

 

 

 

 

 

     Amortization of right-of-use assets

 

 

18

 

 

     Interest on lease liabilities

 

 

12

 

 

Total finance lease cost

 

 

30

 

 

Short-term lease cost

 

 

197

 

 

Variable lease cost(1)

 

 

1,160

 

 

Net lease cost

 

$

4,055

 

 

(1)   Expenses are primarily accounted for in the “Rentals and landing fees” line item. Additional amounts related to embedded leases are accounted for in the “Purchased transportation,” “Fuel” and “Other” line items in the accompanying consolidated statements of income.

Supplemental cash flow information related to leases for the period ended May 31 is as follows (in millions):

 

 

 

2020

 

Cash paid for amounts included in the measurement of lease liabilities:

 

 

 

 

     Operating cash flows paid for operating leases

 

$

2,608

 

     Operating cash flows paid for interest portion of finance leases

 

 

14

 

     Financing cash flows paid for principal portion of finance leases

 

 

84

 

Right-of-use assets obtained in exchange for new operating lease liabilities

 

$

1,915

 

Right-of-use assets obtained in exchange for new finance lease liabilities

 

$

484

 

Supplemental balance sheet information related to leases as of May 31 is as follows (dollars in millions):

 

 

 

2020

 

Operating leases:

 

 

 

 

Operating lease right-of-use assets, net

 

$

13,917

 

 

 

 

 

 

Current portion of operating lease liabilities

 

 

1,923

 

Operating lease liabilities

 

 

12,195

 

    Total operating lease liabilities

 

$

14,118

 

 

 

 

 

 

Finance leases:

 

 

 

 

Net property and equipment

 

$

480

 

 

 

 

 

 

Current portion of long-term debt

 

 

51

 

Long-term debt, less current portion

 

 

434

 

    Total finance lease liabilities

 

$

485

 

 

 

 

 

 

Weighted-average remaining lease term

 

 

 

 

Operating leases

 

 

9.9

 

Finance leases

 

 

32.0

 

 

 

 

 

 

Weighted-average discount rate

 

 

 

 

Operating leases

 

 

3.19

%

Finance leases

 

 

3.58

%

 

We utilize certain aircraft, land, facilities, retail locations and equipment under finance and operating leases that expire at various dates through 2060. We leased 5% of our total aircraft fleet under operating leases as of May 31, 2020 and 6% as of May 31, 2019. A portion of our supplemental aircraft are leased by us under agreements that provide for cancellation upon 30 days’ notice. Our leased facilities include national, regional and metropolitan sorting facilities, retail facilities and administrative buildings.

A summary of future minimum lease payments under noncancelable operating and finance leases with an initial or remaining term in excess of one year at May 31, 2020 is as follows (in millions):

 

 

 

Aircraft

and Related

Equipment

 

 

Facilities

and Other

 

 

Total

Operating

Leases

 

 

Finance Leases

 

 

Total Leases

 

2021

 

$

250

 

 

$

2,099

 

 

$

2,349

 

 

$

67

 

 

$

2,416

 

2022

 

 

233

 

 

 

2,007

 

 

 

2,240

 

 

 

26

 

 

 

2,266

 

2023

 

 

198

 

 

 

1,789

 

 

 

1,987

 

 

 

25

 

 

 

2,012

 

2024

 

 

102

 

 

 

1,563

 

 

 

1,665

 

 

 

24

 

 

 

1,689

 

2025

 

 

69

 

 

 

1,365

 

 

 

1,434

 

 

 

81

 

 

 

1,515

 

Thereafter

 

 

245

 

 

 

6,661

 

 

 

6,906

 

 

 

646

 

 

 

7,552

 

Total lease payments

 

 

1,097

 

 

 

15,484

 

 

 

16,581

 

 

 

869

 

 

 

17,450

 

Less imputed interest

 

 

(92

)

 

 

(2,371

)

 

 

(2,463

)

 

 

(384

)

 

 

(2,847

)

Present value of lease liability

 

$

1,005

 

 

$

13,113

 

 

$

14,118

 

 

$

485

 

 

$

14,603

 

While certain of our lease agreements contain covenants governing the use of the leased assets or require us to maintain certain levels of insurance, none of our lease agreements include material financial covenants or limitations.

As of May 31, 2020, FedEx has entered into additional leases which have not yet commenced and are therefore not part of the right-of-use asset and liability. These leases are generally for build-to-suit facilities and have undiscounted future payments of approximately $1.6 billion, and will commence when FedEx gains beneficial access to the leased asset. Commencement dates are expected to be from fiscal 2021 to fiscal 2022.

FedEx Express makes payments under certain leveraged operating leases that are sufficient to pay principal and interest on certain pass-through certificates. The pass-through certificates are not direct obligations of, or guaranteed by, FedEx or FedEx Express.

We are the lessee under certain operating leases covering a portion of our leased aircraft in which the lessors are trusts established specifically to purchase, finance and lease these aircraft to us. These leasing entities are variable interest entities. We are not the primary beneficiary of the leasing entities, as the lease terms are at market at the inception of the lease and do not include a residual value guarantee, fixed-price purchase option or similar feature that obligates us to absorb decreases in value or entitles us to participate in increases in the value of the aircraft. Therefore, we are not required to consolidate any of these entities as the primary beneficiary. Our maximum exposure under these leases is included in the summary of future minimum lease payments.

Comparative Disclosures Prior to the Adoption of the New Lease Accounting Standard (ASU 2016-02)

The following table is a summary of the Company’s net rental expense for operating leases for the years ended May 31, 2019 and 2018 (in millions):

 

 

 

2019

 

 

2018

 

Minimum rentals

 

$

2,875

 

 

$

2,913

 

Contingent rentals(1)

 

 

222

 

 

 

194

 

 

 

$

3,097

 

 

$

3,107

 

(1)

Contingent rentals are based on equipment usage.

Future minimum lease payments under noncancelable operating leases with an initial or remaining term in excess of one year at May 31, 2019 were as follows (in millions):

 

 

 

Aircraft

and Related

Equipment

 

 

Facilities

and Other

 

 

Total

Operating

Leases

 

2020

 

$

288

 

 

$

2,209

 

 

$

2,497

 

2021

 

 

230

 

 

 

2,033

 

 

 

2,263

 

2022

 

 

212

 

 

 

1,816

 

 

 

2,028

 

2023

 

 

154

 

 

 

1,625

 

 

 

1,779

 

2024

 

 

58

 

 

 

1,428

 

 

 

1,486

 

Thereafter

 

 

85

 

 

 

7,977

 

 

 

8,062

 

Total

 

$

1,027

 

 

$

17,088

 

 

$

18,115

 

 
v3.20.2
Preferred Stock
 12 Months Ended
May 31, 2020
Preferred Stock [Abstract]  
Preferred Stock

NOTE 8: PREFERRED STOCK

Our Certificate of Incorporation authorizes the Board of Directors, at its discretion, to issue up to 4,000,000 shares of preferred stock. The stock is issuable in series, which may vary as to certain rights and preferences, and has no par value. As of May 31, 2020, none of these shares had been issued.

v3.20.2
Accumulated Other Comprehensive Income
 12 Months Ended
May 31, 2020
Accumulated Other Comprehensive Income Loss Net Of Tax [Abstract]  
Accumulated Other Comprehensive Income

NOTE 9: ACCUMULATED OTHER COMPREHENSIVE INCOME

The following table provides changes in AOCI, net of tax, reported in the consolidated financial statements for the years ended May 31 (in millions; amounts in parentheses indicate debits to AOCI):

 

 

 

2020

 

 

2019

 

 

2018

 

Foreign currency translation loss:

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

(954

)

 

$

(759

)

 

$

(685

)

Translation adjustments

 

 

(254

)

 

 

(195

)

 

 

(74

)

Reclassification to retained earnings due to the adoption of ASU 2018-02

 

 

1

 

 

 

—

 

 

 

—

 

Balance at end of period

 

 

(1,207

)

 

 

(954

)

 

 

(759

)

Retirement plans adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

 

89

 

 

 

181

 

 

 

270

 

Prior service cost (credit) arising during period

 

 

3

 

 

 

—

 

 

 

(4

)

Reclassifications from AOCI

 

 

(82

)

 

 

(92

)

 

 

(85

)

Reclassification to retained earnings due to the adoption of ASU 2018-02

 

 

50

 

 

 

—

 

 

 

—

 

Balance at end of period

 

 

60

 

 

 

89

 

 

 

181

 

Accumulated other comprehensive loss at end of period

 

$

(1,147

)

 

$

(865

)

 

$

(578

)

 

The following table presents details of the reclassifications from AOCI for the years ended May 31 (in millions; amounts in parentheses indicate debits to earnings):

 

 

 

Amount Reclassified from

AOCI

 

 

Affected Line Item in the

Income Statement

 

 

2020

 

 

2019

 

 

2018

 

 

 

Amortization of retirement plans prior service

   credits, before tax

 

$

107

 

 

$

120

 

 

$

121

 

 

Other retirement plans (expense) income

Income tax benefit

 

 

(25

)

 

 

(28

)

 

 

(36

)

 

Provision for income taxes

AOCI reclassifications, net of tax

 

$

82

 

 

$

92

 

 

$

85

 

 

Net income

 
v3.20.2
Stock-Based Compensation
 12 Months Ended
May 31, 2020
Employee Service Share Based Compensation Aggregate Disclosures [Abstract]  
Stock-Based Compensation

NOTE 10: STOCK-BASED COMPENSATION

Our total stock-based compensation expense for the years ended May 31 was as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Stock-based compensation expense

 

$

168

 

 

$

174

 

 

$

167

 

We have two types of equity-based compensation: stock options and restricted stock.

STOCK OPTIONS. Under the provisions of our incentive stock plan, key employees and non-employee directors may be granted options to purchase shares of our common stock at a price not less than its fair market value on the date of grant. Vesting requirements are determined at the discretion of the Compensation Committee of our Board of Directors. Option-vesting periods range from one to four years, with 82% of our options vesting ratably over four years. Compensation expense associated with these awards is recognized on a straight-line basis over the requisite service period of the award.

RESTRICTED STOCK. Under the terms of our incentive stock plan, restricted shares of our common stock are awarded to key employees. All restrictions on the shares expire ratably over a four-year period. Shares are valued at the market price on the date of award. The terms of our restricted stock provide for continued vesting subsequent to the employee’s retirement. Compensation expense associated with these awards is recognized on a straight-line basis over the shorter of the requisite service period or the stated vesting period.

ASSUMPTIONS. The key assumptions for the Black-Scholes valuation method include the expected life of the option, stock price volatility, a risk-free interest rate and dividend yield. The following table includes the weighted-average Black-Scholes value of our stock option grants, the intrinsic value of options exercised (in millions) and the key weighted-average assumptions used in the valuation calculations for options granted during the years ended May 31, followed by a discussion of our methodology for developing each of the assumptions used in the valuation model:

 

 

 

2020

 

 

2019

 

 

2018

 

Weighted-average Black-Scholes value

 

$

33.97

 

 

$

61.42

 

 

$

55.72

 

Intrinsic value of options exercised

 

$

44

 

 

$

122

 

 

$

359

 

Black-Scholes Assumptions:

 

 

 

 

 

 

 

 

 

 

 

 

Expected lives

 

6.4 years

 

 

6.4 years

 

 

6.5 years

 

Expected volatility

 

 

23

%

 

 

21

%

 

 

23

%

Risk-free interest rate

 

 

1.91

%

 

 

2.94

%

 

 

2.07

%

Dividend yield

 

 

1.630

%

 

 

0.935

%

 

 

0.796

%

The expected life represents an estimate of the period of time options are expected to remain outstanding, and we examine actual stock option exercises to determine the expected life of the options. Options granted have a maximum term of 10 years. Expected volatilities are based on the actual changes in the market value of our stock and are calculated using daily market value changes from the date of grant over a past period equal to the expected life of the options. The risk-free interest rate is the U.S. Treasury Strip rate posted at the date of grant having a term equal to the expected life of the option. The expected dividend yield is the annual rate of dividends per share over the exercise price of the option.

The following table summarizes information regarding stock option activity for the year ended May 31, 2020:

 

 

 

Stock Options

 

 

 

Shares

 

 

Weighted-

Average

Exercise

Price

 

 

Weighted-

Average

Remaining

Contractual

Term

 

 

Aggregate

Intrinsic Value

(in millions)(1)

 

Outstanding at June 1, 2019

 

 

13,622,515

 

 

$

166.89

 

 

 

 

 

 

 

 

 

Granted

 

 

3,839,144

 

 

 

159.77

 

 

 

 

 

 

 

 

 

Exercised

 

 

(763,104

)

 

 

83.70

 

 

 

 

 

 

 

 

 

Forfeited

 

 

(573,810

)

 

 

192.34

 

 

 

 

 

 

 

 

 

Outstanding at May 31, 2020

 

 

16,124,745

 

 

$

167.79

 

 

 

6.2

 

 

$

118

 

Exercisable

 

 

9,654,040

 

 

$

154.19

 

 

 

4.7

 

 

$

118

 

Expected to vest

 

 

5,975,696

 

 

$

188.09

 

 

 

8.4

 

 

$

—

 

Available for future grants

 

 

27,415,296

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Only presented for options with market value at May 31, 2020 in excess of the exercise price of the option.

The options granted during 2020 are primarily related to our principal annual stock option grant in June 2019.

The following table summarizes information regarding vested and unvested restricted stock for the year ended May 31, 2020:

 

 

 

Restricted Stock

 

 

 

Shares

 

 

Weighted-

Average

Grant Date

Fair Value

 

Unvested at June 1, 2019

 

 

324,478

 

 

$

217.76

 

Granted

 

 

207,012

 

 

 

158.58

 

Vested

 

 

(154,449

)

 

 

200.84

 

Forfeited

 

 

(5,351

)

 

 

197.07

 

Unvested at May 31, 2020

 

 

371,690

 

 

$

192.19

 

During the year ended May 31, 2019, there were 149,579 shares of restricted stock granted with a weighted-average fair value of $253.28 per share. During the year ended May 31, 2018, there were 155,624 shares of restricted stock granted with a weighted-average fair value of $212.60 per share.

Stock option vesting during the years ended May 31 was as follows:

 

 

 

Stock Options

 

 

 

Vested during

the year

 

 

Fair value

(in millions)

 

2020

 

 

2,073,310

 

 

$

99

 

2019

 

 

2,249,301

 

 

$

115

 

2018

 

 

2,465,493

 

 

$

112

 

As of May 31, 2020, there was $209 million of total unrecognized compensation cost, net of estimated forfeitures, related to unvested share-based compensation arrangements. This compensation expense is expected to be recognized on a straight-line basis over the remaining weighted-average vesting period of approximately two years.

Total shares outstanding or available for grant related to equity compensation at May 31, 2020 represented 14% of the total outstanding common and equity compensation shares and equity compensation shares available for grant.

v3.20.2
Computation of Earnings Per Share
 12 Months Ended
May 31, 2020
Earnings Per Share [Abstract]  
Computation of Earnings Per Share

NOTE 11: COMPUTATION OF EARNINGS PER SHARE

The calculation of basic and diluted earnings per common share for the years ended May 31 was as follows (in millions, except per share amounts):

 

 

 

2020

 

 

2019

 

 

2018

 

Basic earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings allocable to common shares(1)

 

$

1,284

 

 

$

539

 

 

$

4,566

 

Weighted-average common shares

 

 

261

 

 

 

262

 

 

 

267

 

Basic earnings per common share

 

$

4.92

 

 

$

2.06

 

 

$

17.08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings allocable to common shares(1)

 

$

1,284

 

 

$

539

 

 

$

4,566

 

Weighted-average common shares

 

 

261

 

 

 

262

 

 

 

267

 

Dilutive effect of share-based awards

 

 

1

 

 

 

3

 

 

 

5

 

Weighted-average diluted shares

 

 

262

 

 

 

265

 

 

 

272

 

Diluted earnings per common share

 

$

4.90

 

 

$

2.03

 

 

$

16.79

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Anti-dilutive options excluded from diluted earnings per common share

 

 

11.7

 

 

 

5.4

 

 

 

2.5

 

 

(1)

Net earnings available to participating securities were immaterial in all periods presented.

v3.20.2
Income Taxes
 12 Months Ended
May 31, 2020
Income Tax Disclosure [Abstract]  
Income Taxes

NOTE 12: INCOME TAXES

The components of the provision for income taxes for the years ended May 31 were as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Current provision (benefit)

 

 

 

 

 

 

 

 

 

 

 

 

Domestic:

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

$

(230

)

 

$

(107

)

 

$

(540

)

State and local

 

 

67

 

 

 

64

 

 

 

43

 

Foreign

 

 

198

 

 

 

243

 

 

 

461

 

 

 

 

35

 

 

 

200

 

 

 

(36

)

Deferred provision (benefit)

 

 

 

 

 

 

 

 

 

 

 

 

Domestic:

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

 

475

 

 

 

(61

)

 

 

271

 

State and local

 

 

1

 

 

 

(7

)

 

 

125

 

Foreign

 

 

(128

)

 

 

(17

)

 

 

(579

)

 

 

 

348

 

 

 

(85

)

 

 

(183

)

 

 

$

383

 

 

$

115

 

 

$

(219

)

 

Pre-tax earnings of foreign operations for 2020, 2019 and 2018 were $634 million, $929 million and $958 million, respectively. These amounts represent only a portion of total results associated with international shipments and do not represent our international results of operations.

A reconciliation of total income tax expense and the amount computed by applying the statutory federal income tax rate (21% in 2020, 21% in 2019 and 29.2% in 2018) to income before taxes for the years ended May 31 is as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Taxes computed at federal statutory rate

 

$

350

 

 

$

138

 

 

$

1,271

 

(Decreases) increases in income tax from:

 

 

 

 

 

 

 

 

 

 

 

 

Valuation allowance

 

 

(129

)

 

 

(79

)

 

 

31

 

Goodwill impairment charge

 

 

75

 

 

 

—

 

 

 

109

 

Benefit from U.S. tax loss carryback to prior years

 

 

(71

)

 

 

—

 

 

 

—

 

Non-deductible expenses

 

 

70

 

 

 

79

 

 

 

81

 

State and local income taxes, net of federal benefit

 

 

53

 

 

 

44

 

 

 

119

 

U.S. deferred tax adjustments related to foreign operations

 

 

51

 

 

 

—

 

 

 

—

 

Foreign operations

 

 

38

 

 

 

(1

)

 

 

25

 

Uncertain tax positions

 

 

(14

)

 

 

8

 

 

 

86

 

Foreign tax rate enactments

 

 

(10

)

 

 

50

 

 

 

6

 

Benefits from share-based payments

 

 

(5

)

 

 

(18

)

 

 

(60

)

TCJA(1)

 

 

—

 

 

 

(71

)

 

 

(1,354

)

Foreign tax credits from distributions

 

 

—

 

 

 

(8

)

 

 

(225

)

Corporate structuring transactions(2)

 

 

—

 

 

 

—

 

 

 

(255

)

Other, net

 

 

(25

)

 

 

(27

)

 

 

(53

)

Provision for income taxes (benefit)

 

$

383

 

 

$

115

 

 

$

(219

)

Effective Tax Rate

 

 

23.0

%

 

 

17.6

%

 

 

(5.0

)%

(1)

Primary components in 2018 were a $1.15 billion benefit from the remeasurement of our net U.S. deferred tax liability and a $204 million one-time benefit from a contribution to our U.S. Pension Plans in 2018.

(2)

The 2018 net benefit consists of foreign deferred tax benefits of $434 million, which were partially offset by U.S. deferred tax expenses of $179 million. 

The 2020 tax rate includes a benefit of $133 million from the reduction of a valuation allowance on certain foreign tax loss carryforwards due to operational changes which impacted the determination of the realizability of the deferred tax asset in that jurisdiction. The 2020 tax rate also includes a deferred income tax expense of $51 million for a change in deferred tax balances related to future foreign tax credits from our international structure as a result of changes in legal entity forecasts during the fourth quarter. The 2020 tax rate was negatively impacted by decreased earnings in certain non-U.S. jurisdictions.  

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted to address the economic impact of the COVID-19 pandemic in the United States. Among other things, the CARES Act allows a five-year carryback period for tax losses generated in 2019 through 2021. As a result, an income tax benefit of $71 million was recorded in 2020 in connection with a tax loss generated during 2020 that the CARES Act will now allow to be carried back to 2015, a tax year when the U.S. federal income tax rate was 35%.  

The 2019 tax rate includes a benefit of $90 million from the reduction of a valuation allowance on tax loss carryforwards due to certain business operational changes from the integration of FedEx Express and TNT Express in a local jurisdiction, which impacted our determination of the realizability of the deferred tax asset in that jurisdiction and an expense of $50 million from the impact on our deferred taxes attributable to a lower tax rate in the Netherlands. The 2019 tax rate was also favorably impacted by the TCJA, which resulted in benefits of approximately $75 million from accelerated deductions claimed on our 2018 U.S. income tax return filed in 2019 and approximately $40 million from the lower statutory tax rate on fiscal 2019 earnings.

The 2018 tax rate was favorably impacted by the TCJA, which resulted in a provisional benefit of $1.15 billion from the remeasurement of our net U.S. deferred tax liability. In addition, we recognized a one-time benefit of $204 million from a $1.5 billion contribution to our U.S. Pension Plans in 2018. Our 2018 tax rate also included a net benefit of $255 million from corporate structuring transactions as part of the ongoing integration of FedEx Express and TNT Express and a benefit of $225 million from foreign tax credits generated by distributions to the U.S. from our foreign operations. The 2018 tax rate was negatively impacted by an increase in uncertain tax positions for income tax audits.

The TCJA, enacted on December 22, 2017, significantly changed the U.S. corporate income tax system by reducing our U.S. statutory federal income tax rate from 35% to 21% (due to our May 31 fiscal year-end, the lower rate was phased in, resulting in a U.S. statutory federal rate of 29.2% for 2018 and a statutory federal rate of 21% for 2019 and subsequent years).  

During 2019, the U.S. Treasury Department issued final regulations covering the one-time transition tax on unrepatriated foreign earnings, which was enacted as part of the TCJA. Certain guidance included in these final regulations is inconsistent with our interpretation that led to the recognition of a $233 million cumulative benefit through 2019. Notwithstanding this inconsistency, we remain confident in our interpretation of the TCJA and intend to defend this position through litigation, if necessary. However, if we are ultimately unsuccessful in defending our position, we may be required to reverse the benefit previously recorded.

In December 2017, the SEC staff issued Staff Accounting Bulletin (“SAB”) 118 to provide guidance to registrants in accounting for income taxes under the TCJA. In accordance with SAB 118, we made reasonable estimates and recorded provisional amounts for the TCJA during 2018. Under the transitional provisions of SAB 118, we had a one-year measurement period to complete the accounting for the initial tax effects of the TCJA. During 2019, we completed our accounting for the tax effects of the TCJA and recorded a $4 million tax expense to adjust the $1.15 billion provisional benefit recorded in 2018.

As provided for in the TCJA, our historical earnings were subject to the one-time transition tax and can now be repatriated to the U.S. with a de minimis tax cost. We continue to assert that both our historical and current earnings in our foreign subsidiaries are permanently reinvested and therefore no deferred taxes or withholding taxes have been provided, including deferred taxes on any additional outside basis difference (e.g., stock basis differences attributable to acquisition or other permanent differences).

The significant components of deferred tax assets and liabilities as of May 31 were as follows (in millions):

 

 

 

2020

 

 

2019

 

 

 

Deferred Tax

Assets

 

 

Deferred Tax

Liabilities

 

 

Deferred Tax

Assets

 

 

Deferred Tax

Liabilities

 

Property, equipment, leases and intangibles(1)

 

$

3,819

 

 

$

8,745

 

 

$

592

 

 

$

4,633

 

Employee benefits

 

 

1,448

 

 

 

—

 

 

 

1,256

 

 

 

—

 

Self-insurance accruals

 

 

647

 

 

 

—

 

 

 

585

 

 

 

—

 

Other

 

 

579

 

 

 

375

 

 

 

510

 

 

 

340

 

Net operating loss/credit carryforwards

 

 

1,262

 

 

 

—

 

 

 

1,139

 

 

 

—

 

Valuation allowances

 

 

(450

)

 

 

—

 

 

 

(590

)

 

 

—

 

 

 

$

7,305

 

 

$

9,120

 

 

$

3,492

 

 

$

4,973

 

 

(1)

Includes impact from adoption of the new lease accounting standard in 2020. See Note 7 for additional information.

 

The net deferred tax liabilities as of May 31 have been classified in the balance sheets as follows (in millions):

 

 

 

2020

 

 

2019

 

Noncurrent deferred tax assets(1)

 

$

1,347

 

 

$

1,340

 

Noncurrent deferred tax liabilities

 

 

(3,162

)

 

 

(2,821

)

 

 

$

(1,815

)

 

$

(1,481

)

 

(1)

Noncurrent deferred tax assets are included in the line item “Other Assets” in our accompanying consolidated balance sheets.

We have approximately $3.6 billion of net operating loss carryovers in various foreign jurisdictions and $1.1 billion of state operating loss carryovers. The valuation allowances primarily represent amounts reserved for operating loss carryforwards, which expire over varying periods starting in 2021. Therefore, we establish valuation allowances if it is more likely than not that deferred income tax assets will not be realized. We believe that we will generate sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets in our consolidated balance sheets. See Note 1 above for more information on our policy for assessing the recoverability of deferred tax assets and valuation allowances.

We are subject to taxation in the U.S. and various U.S. state, local and foreign jurisdictions. The Internal Revenue Service (“IRS”) is currently auditing our 2016 and 2017 tax returns. It is reasonably possible that certain income tax return proceedings will be completed during the next 12 months and could result in a change in our balance of unrecognized tax benefits. The expected impact of any changes would not be material to our consolidated financial statements. During 2020, the IRS closed the audit of our 2014 and 2015 income tax returns. The settlement of this audit did not have a material impact to our consolidated financial statements.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Balance at beginning of year

 

$

164

 

 

$

161

 

 

$

67

 

Increases for tax positions taken in the current year

 

 

3

 

 

 

—

 

 

 

3

 

Increases for tax positions taken in prior years

 

 

4

 

 

 

31

 

 

 

103

 

Increase for business acquisition

 

 

—

 

 

 

—

 

 

 

—

 

Decreases for tax positions taken in prior years

 

 

(10

)

 

 

(4

)

 

 

(10

)

Settlements

 

 

(31

)

 

 

(21

)

 

 

(2

)

Decreases from lapse of statute of limitations

 

 

—

 

 

 

—

 

 

 

—

 

Changes due to currency translation

 

 

(1

)

 

 

(3

)

 

 

—

 

Balance at end of year

 

$

129

 

 

$

164

 

 

$

161

 

 

Our liabilities recorded for uncertain tax positions include $127 million at May 31, 2020 and $141 million at May 31, 2019 associated with positions that, if favorably resolved, would provide a benefit to our income tax expense. We classify interest related to income tax liabilities as interest expense and, if applicable, penalties are recognized as a component of income tax expense. The balance of accrued interest and penalties was $41 million on May 31, 2020 and $38 million on May 31, 2019. Total interest and penalties included in our consolidated statements of income are immaterial.

It is difficult to predict the ultimate outcome or the timing of resolution for tax positions. Changes may result from the conclusion of ongoing audits, appeals or litigation in state, local, federal and foreign tax jurisdictions, or from the resolution of various proceedings between U.S. and foreign tax authorities. Our liability for uncertain tax positions includes no matters that are individually or collectively material to us. It is reasonably possible that the amount of the benefit with respect to certain of our unrecognized tax positions will increase or decrease within the next 12 months, but an estimate of the range of the reasonably possible changes cannot be made. However, we do not expect that the resolution of any of our uncertain tax positions will have a material effect on us.

v3.20.2
Retirement Plans
 12 Months Ended
May 31, 2020
Compensation And Retirement Disclosure [Abstract]  
Retirement Plans

NOTE 13: RETIREMENT PLANS

We sponsor programs that provide retirement benefits to most of our employees. These programs include defined benefit pension plans, defined contribution plans and postretirement healthcare plans. 

The accounting guidance related to postretirement benefits requires recognition in the balance sheet of the funded status of defined benefit pension and other postretirement benefit plans, and the recognition in either expense or AOCI of unrecognized gains or losses and prior service costs or credits. We use MTM accounting for the recognition of our actuarial gains and losses related to our defined benefit pension and postretirement healthcare plans as described in Note 1. The funded status is measured as the difference between the fair value of the plan’s assets and the PBO of the plan.

A summary of our retirement plan costs over the past three years is as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Defined benefit pension plans

 

$

148

 

 

$

111

 

 

$

150

 

Defined contribution plans

 

 

574

 

 

 

561

 

 

 

527

 

Postretirement healthcare plans

 

 

85

 

 

 

75

 

 

 

74

 

Retirement plans MTM loss (gain)

 

 

794

 

 

 

3,882

 

 

 

(10

)

 

 

$

1,601

 

 

$

4,629

 

 

$

741

 

 

The components of the MTM adjustments are as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Discount rate change

 

$

2,997

 

 

$

1,780

 

 

$

(613

)

Demographic experience:

 

 

 

 

 

 

 

 

 

 

 

 

   Current year actuarial loss

 

 

50

 

 

 

739

 

 

 

419

 

   Change in future assumptions

 

 

(229

)

 

 

887

 

 

 

(37

)

Actual versus expected return on assets

 

 

(2,024

)

 

 

476

 

 

 

11

 

Annuity contract purchase

 

 

—

 

 

 

—

 

 

 

210

 

Total MTM loss (gain)

 

$

794

 

 

$

3,882

 

 

$

(10

)

2020

The weighted-average discount rate for all our pension and postretirement healthcare plans decreased from 3.69% at May 31, 2019 to 3.05% at May 31, 2020. The demographic experience in 2020 reflects an update to our mortality assumption and a current-year actuarial loss due to unfavorable experience compared to various demographic assumptions. The actual rate of return, which is net of all fees and expenses, on our U.S. Pension Plan assets of 15.00% was higher than our expected return of 6.75%, as return seeking assets, primarily equities, were positive despite equity market volatility. Additionally, fixed income assets performed as expected as interest rates declined.

2019

The weighted-average discount rate for all our pension and postretirement healthcare plans decreased from 4.11% at May 31, 2018 to 3.69% at May 31, 2019. The demographic experience in 2019 reflects updates to several forward-looking assumptions, including retirement rates, disability incidence rates and salary increase assumptions, and a current-year actuarial loss due to unfavorable experience compared to various demographic assumptions. The actual rate of return, which is net of all fees and expenses, on our U.S. Pension Plan assets of 4.05% was lower than our expected return of 6.75%, as lower than expected equity returns negatively impacted return-seeking assets while fixed-income assets performed as expected due to declining interest rates.

 

2018

The weighted-average discount rate for all of our pension and postretirement healthcare plans increased from 3.98% at May 31, 2017 to 4.11% at May 31, 2018. The demographic experience in 2018 reflects a liability loss due to unfavorable results related to various demographic assumptions. The annuity contract purchase loss relates to the contract with Metropolitan Life Insurance Company as discussed below. The actual rate of return, which is net of all fees and expenses, on our U.S. Pension Plan assets of 6.30% was slightly lower than our expected return of 6.50% primarily due to generally flat returns in the long-duration fixed-income portfolio partially offset by strong returns from global equities.

PENSION PLANS. Our largest pension plan covers certain U.S. employees age 21 and over, with at least one year of service. Pension benefits for most employees are accrued under a cash balance formula we call the Portable Pension Account (“PPA”). Under the PPA, the retirement benefit is expressed as a dollar amount in a notional account that grows with annual credits based on pay, age and years of credited service, and interest on the notional account balance. The PPA benefit is payable as a lump sum or an annuity at retirement at the election of the employee. The plan interest credit rate varies from year to year based on a U.S. Treasury index. Prior to 2009, certain employees earned benefits using a traditional pension formula (based on average earnings and years of service). Benefits under this formula were capped on May 31, 2008 for most employees.

We also sponsor or participate in nonqualified benefit plans covering certain of our U.S. employee groups and other pension plans covering certain of our international employees. The international defined benefit pension plans provide benefits primarily based on earnings and years of service and are funded in compliance with local laws and practices. The majority of our international obligations are for defined benefit pension plans in the Netherlands and the United Kingdom.

In May 2018, we entered into an agreement with Metropolitan Life Insurance Company to purchase a group annuity contract and transfer approximately $6 billion of our U.S. Pension Plan obligations. The transaction transferred responsibility for pension benefits to Metropolitan Life Insurance Company for approximately 41,000 of our retirees and beneficiaries who satisfied certain conditions and were receiving a monthly benefit from participating U.S. Pension Plans. There was no change to the pension benefits for any plan participants as a result of this transaction. The purchase of the group annuity contract was funded directly by assets of the U.S. Pension Plans. We recognized a $210 million one-time settlement loss in connection with this transaction, which was included in our 2018 year-end MTM retirement plans accounting adjustment.

In November 2019, we announced the closing of our U.S.-based defined benefit pension plans to new non-union employees hired on or after January 1, 2020. We will introduce an all-401(k)-plan retirement benefit structure for eligible employees with a higher company match of up to 8% across all U.S.-based operating companies. During 2021, current eligible employees under the PPA pension formula will be given a one-time option to continue to be eligible for pension compensation credits under the existing PPA formula and remain in the existing 401(k) plan with its company match of up to 3.5%, or to cease receiving compensation credits under the PPA and move to the new 401(k) plan with the higher match of up to 8%. Changes to the new 401(k) plan structure become effective beginning January 1, 2022. While this new program will provide employees greater flexibility and reduce our long-term pension costs, it will not have a material impact on current or near-term financial results.

POSTRETIREMENT HEALTHCARE PLANS. Certain of our subsidiaries offer medical, dental and vision coverage to eligible U.S. retirees and their eligible dependents and a small number of international employees. U.S. employees covered by the principal plan become eligible for these benefits at age 55 and older, if they have permanent, continuous service of at least 10 years after attainment of age 45 if hired prior to January 1, 1988, or at least 20 years after attainment of age 35 if hired on or after January 1, 1988. Postretirement healthcare benefits are capped at 150% of the 1993 per capita projected employer cost, which has been reached under most plans, so these benefits are not subject to future inflation.

Effective January 1, 2018, certain of our U.S. postretirement healthcare benefits were converted to a lump-sum benefit in a notional retiree health reimbursement account (HRA) for eligible participants. The HRA is available to reimburse a participant for qualifying healthcare premium costs and limits the company liability to the HRA account balance. The amount of the credit is based on age at January 1, 2018 or upon age at retirement thereafter. In connection with this change, retiree health coverage was closed to most new employees hired on or after January 1, 2018.

PENSION PLAN ASSUMPTIONS. The accounting for pension and postretirement healthcare plans includes numerous assumptions, such as: discount rates; expected long-term investment returns on plan assets; future salary increases; employee turnover; mortality; and retirement ages.  

Weighted-average actuarial assumptions used to determine the benefit obligations and net periodic benefit cost of our plans are as follows:

 

 

 

U.S. Pension Plans

 

 

International Pension Plans

 

 

Postretirement Healthcare Plans

 

 

 

2020

 

 

2019

 

 

2018

 

 

2020

 

 

2019

 

 

2018

 

 

2020

 

 

2019

 

 

2018

 

Discount rate used to determine benefit

   obligation

 

 

3.14

%

 

 

3.85

%

 

 

4.27

%

 

 

1.79

%

 

 

1.92

%

 

 

2.37

%

 

 

2.95

%

 

 

3.70

%

 

 

4.33

%

Discount rate used to determine net periodic

   benefit cost

 

 

3.85

 

 

 

4.27

 

 

 

4.08

 

 

 

1.92

 

 

 

2.34

 

 

 

2.43

 

 

 

3.70

 

 

 

4.33

 

 

 

4.32

 

Rate of increase in future compensation

   levels used to determine benefit obligation

 

 

5.17

 

 

 

5.10

 

 

 

4.43

 

 

 

2.19

 

 

 

2.27

 

 

 

2.26

 

 

 

—

 

 

 

—

 

 

 

—

 

Rate of increase in future compensation levels

   used to determine net periodic benefit cost

 

 

5.10

 

 

 

4.43

 

 

 

4.47

 

 

 

2.43

 

 

 

2.22

 

 

 

2.42

 

 

 

—

 

 

 

—

 

 

 

—

 

Expected long-term rate of return on assets

 

 

6.75

 

 

 

6.75

 

 

 

6.50

 

 

 

3.26

 

 

 

3.12

 

 

 

3.09

 

 

 

—

 

 

 

—

 

 

 

—

 

Interest crediting rate used to determine net

   periodic benefit cost

 

 

4.00

 

 

 

4.00

 

 

 

4.00

 

 

 

2.20

 

 

 

2.20

 

 

 

2.20

 

 

 

—

 

 

 

—

 

 

 

—

 

Interest crediting rate used to determine

   benefit obligation

 

 

4.00

 

 

 

4.00

 

 

 

4.00

 

 

 

2.00

 

 

 

2.20

 

 

 

2.20

 

 

 

—

 

 

 

—

 

 

 

—

 

 

Our U.S. Pension Plan assets are invested primarily in publicly tradable securities, and our pension plans hold only a minimal investment in FedEx common stock that is entirely at the discretion of third-party pension fund investment managers. As part of our strategy to manage pension costs and funded status volatility, we follow a liability-driven investment strategy to better align plan assets with liabilities.

Establishing the expected future rate of investment return on our pension assets is a judgmental matter, which we review on an annual basis and revise as appropriate. Management considers the following factors in determining this assumption:

 

•

the duration of our pension plan liabilities, which drives the investment strategy we can employ with our pension plan assets;

 

•

the types of investment classes in which we invest our pension plan assets and the expected compound geometric return we can reasonably expect those investment classes to earn over time, net of all fees and expenses; and

 

•

the investment returns we can reasonably expect our investment management program to achieve in excess of the returns we could expect if investments were made strictly in indexed funds.

For consolidated pension expense, we assumed a 6.75% expected long-term rate of return on our U.S. Pension Plan assets in 2020 and 2019, and 6.50% in 2018. For the 15-year period ended May 31, 2020, our actual return was 7.70%, net of all fees and expenses.    

The investment strategy for our U.S. Pension Plan assets is to utilize a diversified mix of public equities and fixed-income and alternative investments to earn a long-term investment return that meets our pension plan obligations. Our largest asset classes are Corporate Fixed Income Securities and Government Fixed Income Securities (which are largely benchmarked against the Barclays Long Government, Barclays Long Corporate or the Citigroup 20+ STRIPS indices), and U.S. and non-U.S. Equities (which are mainly benchmarked to the S&P 500 Index and MSCI indices). Accordingly, we do not have any significant concentrations of risk. Active management strategies are utilized within the plan in an effort to realize investment returns in excess of market indices. Our investment strategy also includes the limited use of derivative financial instruments on a discretionary basis to improve investment returns and manage portfolio risk.

The following is a description of the valuation methodologies used for investments measured at fair value:

 

•

Cash and cash equivalents. Level 1 investments include cash, cash equivalents and foreign currency valued using exchange rates. Level 2 investments include short-term investment funds which are collective funds priced at a constant value by the administrator of the funds.

 

•

Domestic, international and global equities. Level 1 investments are valued at the closing price or last trade reported on the major market on which the individual securities are traded.

 

•

Fixed income. We determine the fair value of Level 2 corporate bonds, U.S. and non-U.S. government securities and other fixed income securities by using bid evaluation pricing models or quoted prices of securities with similar characteristics.

 

•

Alternative Investments. The valuation of Level 3 investments requires significant judgment due to the absence of quoted market prices, the inherent lack of liquidity and the long-term nature of such assets. Investments in private equity, debt, real estate, hedge funds and other private investments are valued at estimated fair value based on quarterly financial information received from the investment advisor and/or general partner. These estimates incorporate factors such as contributions and distributions, market transactions, market comparables and performance multiples.

The fair values of investments by level and asset category and the weighted-average asset allocations for our U.S. Pension Plans and our most significant international pension plans at the measurement date are presented in the following table (in millions):

 

 

 

Plan Assets at Measurement Date

 

 

 

2020

 

Asset Class (U.S. Plans)

 

Fair Value

 

 

Actual %

 

 

Target

Range

%(1)

 

Quoted Prices in

Active Markets

Level 1

 

 

Other Observable

Inputs

Level 2

 

 

Unobservable

Inputs

Level 3

 

Cash and cash equivalents

 

$

709

 

 

 

3

%

 

0 - 5%

 

$

278

 

 

$

431

 

 

 

 

 

Equities

 

 

 

 

 

 

 

 

 

30 - 50

 

 

 

 

 

 

 

 

 

 

 

 

U.S. large cap equity(2)

 

 

3,070

 

 

 

11

 

 

 

 

 

1,172

 

 

 

 

 

 

 

 

 

International equities(2)

 

 

3,314

 

 

 

12

 

 

 

 

 

2,738

 

 

 

 

 

 

 

 

 

Global equities(2)

 

 

1,350

 

 

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. SMID cap equity

 

 

673

 

 

 

3

 

 

 

 

 

673

 

 

 

 

 

 

 

 

 

Fixed income securities

 

 

 

 

 

 

 

 

 

50 - 70

 

 

 

 

 

 

 

 

 

 

 

 

Corporate

 

 

7,983

 

 

 

30

 

 

 

 

 

 

 

 

 

7,983

 

 

 

 

 

Government(2)

 

 

6,928

 

 

 

26

 

 

 

 

 

 

 

 

 

4,652

 

 

 

 

 

Mortgage-backed and other(2)

 

 

634

 

 

 

2

 

 

 

 

 

 

 

 

 

170

 

 

 

 

 

Alternative investments(2)

 

 

2,264

 

 

 

8

 

 

0 - 15

 

 

 

 

 

 

 

 

 

$

416

 

Other

 

 

53

 

 

 

—

 

 

 

 

 

57

 

 

 

(3

)

 

 

 

 

Total U.S. plan assets

 

$

26,978

 

 

 

100

%

 

 

 

$

4,918

 

 

$

13,233

 

 

$

416

 

Asset Class (International Plans)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

9

 

 

 

1

%

 

 

 

$

9

 

 

 

 

 

 

 

 

 

Equities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

International equities(2)

 

 

72

 

 

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Global equities(2)

 

 

218

 

 

 

15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed income securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate(2)

 

 

342

 

 

 

23

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government(2)

 

 

510

 

 

 

34

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed and other(2)

 

 

188

 

 

 

12

 

 

 

 

 

318

 

 

 

 

 

 

 

 

 

Other(2)

 

 

158

 

 

 

10

 

 

 

 

 

13

 

 

$

63

 

 

 

 

 

Total international plan assets

 

$

1,497

 

 

 

100

%

 

 

 

$

340

 

 

$

63

 

 

 

 

 

(1)

Target ranges have not been provided for international plan assets as they are managed at an individual country level.

(2)

Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy but are included in the total.

 

 

 

Plan Assets at Measurement Date

 

 

 

2019

 

Asset Class (U.S. Plans)

 

Fair Value

 

 

Actual %

 

 

Target

Range

%(1)

 

Quoted Prices in

Active Markets

Level 1

 

 

Other Observable

Inputs

Level 2

 

 

Unobservable

Inputs

Level 3

 

Cash and cash equivalents

 

$

570

 

 

 

2

%

 

0 - 5%

 

$

50

 

 

$

520

 

 

 

 

 

Equities

 

 

 

 

 

 

 

 

 

30 - 50

 

 

 

 

 

 

 

 

 

 

 

 

U.S. large cap equity(2)

 

 

2,546

 

 

 

11

 

 

 

 

 

875

 

 

 

 

 

 

 

 

 

International equities(2)

 

 

3,306

 

 

 

14

 

 

 

 

 

2,700

 

 

 

 

 

 

 

 

 

Global equities(2)

 

 

1,451

 

 

 

6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. SMID cap equity

 

 

731

 

 

 

3

 

 

 

 

 

730

 

 

 

1

 

 

 

 

 

Fixed income securities

 

 

 

 

 

 

 

 

 

50 - 70

 

 

 

 

 

 

 

 

 

 

 

 

Corporate

 

 

6,794

 

 

 

29

 

 

 

 

 

 

 

 

 

6,794

 

 

 

 

 

Government(2)

 

 

5,384

 

 

 

23

 

 

 

 

 

 

 

 

 

3,742

 

 

 

 

 

Mortgage-backed and other(2)

 

 

622

 

 

 

3

 

 

 

 

 

 

 

 

 

175

 

 

 

 

 

Alternative investments(2)

 

 

1,963

 

 

 

9

 

 

0 - 15

 

 

 

 

 

 

 

 

 

$

302

 

Other

 

 

(47

)

 

 

—

 

 

 

 

 

(45

)

 

 

(2

)

 

 

 

 

Total U.S. plan assets

 

$

23,320

 

 

 

100

%

 

 

 

$

4,310

 

 

$

11,230

 

 

$

302

 

Asset Class (International Plans)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

57

 

 

 

4

%

 

 

 

$

57

 

 

 

 

 

 

 

 

 

Equities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

International equities(2)

 

 

72

 

 

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Global equities(2)

 

 

206

 

 

 

15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed income securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate(2)

 

 

322

 

 

 

24

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government(2)

 

 

438

 

 

 

32

 

 

 

 

 

290

 

 

 

 

 

 

 

 

 

Mortgage-backed and other(2)

 

 

167

 

 

 

12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other(2)

 

 

112

 

 

 

8

 

 

 

 

 

10

 

 

$

17

 

 

 

 

 

Total international plan assets

 

$

1,374

 

 

 

100

%

 

 

 

$

357

 

 

$

17

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Target ranges have not been provided for international plan assets as they are managed at an individual country level.

(2)

Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy but are included in the total.

The change in fair value of Level 3 assets that use significant unobservable inputs is shown in the table below (in millions):

 

 

 

U.S. Pension Plans

 

 

 

2020

 

 

2019

 

Balance at beginning of year

 

$

302

 

 

$

209

 

Actual return on plan assets:

 

 

 

 

 

 

 

 

Assets held during current year

 

 

19

 

 

 

11

 

Assets sold during the year

 

 

16

 

 

 

13

 

Purchases, sales and settlements

 

 

79

 

 

 

69

 

Balance at end of year

 

$

416

 

 

$

302

 

 

The following tables provide a reconciliation of the changes in the pension and postretirement healthcare plans’ benefit obligations and fair value of assets over the two-year period ended May 31, 2020 and a statement of the funded status as of May 31, 2020 and 2019 (in millions):

 

 

 

U.S. Pension Plans

 

 

International

Pension Plans

 

 

Postretirement Healthcare Plans

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Accumulated Benefit Obligation (“ABO”)

 

$

29,272

 

 

$

25,915

 

 

$

2,012

 

 

$

2,084

 

 

 

 

 

 

 

 

 

Changes in PBO and Accumulated Postretirement

   Benefit Obligation (“APBO”)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PBO/APBO at the beginning of year

 

$

26,554

 

 

$

22,653

 

 

$

2,301

 

 

$

2,167

 

 

$

1,221

 

 

$

955

 

Service cost

 

 

768

 

 

 

689

 

 

 

96

 

 

 

94

 

 

 

42

 

 

 

35

 

Interest cost

 

 

1,000

 

 

 

951

 

 

 

43

 

 

 

49

 

 

 

44

 

 

 

40

 

Actuarial loss (gain)

 

 

2,817

 

 

 

3,016

 

 

 

(87

)

 

 

127

 

 

 

85

 

 

 

266

 

Benefits paid

 

 

(940

)

 

 

(755

)

 

 

(41

)

 

 

(38

)

 

 

(127

)

 

 

(123

)

Settlements

 

 

—

 

 

 

—

 

 

 

(6

)

 

 

(13

)

 

 

—

 

 

 

—

 

Other

 

 

—

 

 

 

—

 

 

 

(64

)

 

 

(85

)

 

 

49

 

 

 

48

 

PBO/APBO at the end of year

 

$

30,199

 

 

$

26,554

 

 

$

2,242

 

 

$

2,301

 

 

$

1,314

 

 

$

1,221

 

Change in Plan Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair value of plan assets at the beginning of year

 

$

23,320

 

 

$

22,057

 

 

$

1,578

 

 

$

1,509

 

 

$

—

 

 

$

—

 

Actual return on plan assets

 

 

3,530

 

 

 

984

 

 

 

146

 

 

 

94

 

 

 

—

 

 

 

—

 

Company contributions

 

 

1,068

 

 

 

1,034

 

 

 

86

 

 

 

91

 

 

 

77

 

 

 

73

 

Benefits paid

 

 

(940

)

 

 

(755

)

 

 

(41

)

 

 

(38

)

 

 

(127

)

 

 

(123

)

Settlements

 

 

—

 

 

 

—

 

 

 

(6

)

 

 

(13

)

 

 

—

 

 

 

—

 

Other

 

 

—

 

 

 

—

 

 

 

(50

)

 

 

(65

)

 

 

50

 

 

 

50

 

Fair value of plan assets at the end of year

 

$

26,978

 

 

$

23,320

 

 

$

1,713

 

 

$

1,578

 

 

$

—

 

 

$

—

 

Funded Status of the Plans

 

$

(3,221

)

 

$

(3,234

)

 

$

(529

)

 

$

(723

)

 

$

(1,314

)

 

$

(1,221

)

Amount Recognized in the Balance Sheet at May 31:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noncurrent asset

 

$

—

 

 

$

—

 

 

$

142

 

 

$

82

 

 

$

—

 

 

$

—

 

Current pension, postretirement healthcare and

   other benefit obligations

 

 

(38

)

 

 

(70

)

 

 

(17

)

 

 

(16

)

 

 

(104

)

 

 

(87

)

Noncurrent pension, postretirement healthcare

   and other benefit obligations

 

 

(3,183

)

 

 

(3,164

)

 

 

(654

)

 

 

(789

)

 

 

(1,210

)

 

 

(1,134

)

Net amount recognized

 

$

(3,221

)

 

$

(3,234

)

 

$

(529

)

 

$

(723

)

 

$

(1,314

)

 

$

(1,221

)

Amounts Recognized in AOCI and not yet reflected

   in Net Periodic Benefit Cost:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Prior service (credit) cost and other

 

$

(68

)

 

$

(173

)

 

$

(7

)

 

$

(6

)

 

$

1

 

 

$

1

 

 

Our pension plans included the following components at May 31 (in millions):

 

 

 

PBO

 

 

Fair Value of

Plan Assets

 

 

Funded Status

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

Qualified

 

$

30,004

 

 

$

26,978

 

 

$

(3,026

)

Nonqualified

 

 

195

 

 

 

—

 

 

 

(195

)

International Plans

 

 

2,242

 

 

 

1,713

 

 

 

(529

)

Total

 

$

32,441

 

 

$

28,691

 

 

$

(3,750

)

2019

 

 

 

 

 

 

 

 

 

 

 

 

Qualified

 

$

26,300

 

 

$

23,320

 

 

$

(2,980

)

Nonqualified

 

 

254

 

 

 

—

 

 

 

(254

)

International Plans

 

 

2,301

 

 

 

1,578

 

 

 

(723

)

Total

 

$

28,855

 

 

$

24,898

 

 

$

(3,957

)

 

The table above provides the PBO, fair value of plan assets and funded status of our pension plans on an aggregated basis. The following tables present our plans on a disaggregated basis to show those plans (as a group) whose assets did not exceed their liabilities. The fair value of plan assets for pension plans with a PBO or ABO in excess of plan assets at May 31 were as follows (in millions):

 

 

 

PBO Exceeds the Fair Value

of Plan Assets

 

 

 

2020

 

 

2019

 

U.S. Pension Benefits

 

 

 

 

 

 

 

 

Fair value of plan assets

 

$

26,978

 

 

$

23,320

 

PBO

 

 

(30,199

)

 

 

(26,554

)

Net funded status

 

$

(3,221

)

 

$

(3,234

)

International Pension Benefits

 

 

 

 

 

 

 

 

Fair value of plan assets

 

$

205

 

 

$

1,125

 

PBO

 

 

(876

)

 

 

(1,929

)

Net funded status

 

$

(671

)

 

$

(804

)

 

 

 

ABO Exceeds the Fair Value

of Plan Assets

 

 

 

2020

 

 

2019

 

U.S. Pension Benefits

 

 

 

 

 

 

 

 

ABO(1)

 

$

(29,272

)

 

$

(25,915

)

Fair value of plan assets

 

 

26,978

 

 

 

23,320

 

PBO

 

 

(30,199

)

 

 

(26,554

)

Net funded status

 

$

(3,221

)

 

$

(3,234

)

International Pension Benefits

 

 

 

 

 

 

 

 

ABO(1)

 

$

(637

)

 

$

(1,709

)

Fair value of plan assets

 

 

175

 

 

 

1,120

 

PBO

 

 

(840

)

 

 

(1,925

)

Net funded status

 

$

(665

)

 

$

(805

)

(1)

ABO not used in determination of funded status.

Contributions to our U.S. Pension Plans for the years ended May 31 were as follows (in millions):

 

 

 

2020

 

 

2019

 

Required

 

$

—

 

 

$

—

 

Voluntary

 

 

1,000

 

 

 

1,000

 

 

 

$

1,000

 

 

$

1,000

 

 

For 2021, no pension contributions are required for our U.S. Pension Plans as they are fully funded under the Employee Retirement Income Security Act.

Net periodic benefit cost for the three years ended May 31 were as follows (in millions):

 

 

 

U.S. Pension Plans

 

 

International Pension Plans

 

 

Postretirement Healthcare Plans

 

 

 

2020

 

 

2019

 

 

2018

 

 

2020

 

 

2019

 

 

2018

 

 

2020

 

 

2019

 

 

2018

 

Service cost

 

$

768

 

 

$

689

 

 

$

679

 

 

$

96

 

 

$

94

 

 

$

97

 

 

$

42

 

 

$

35

 

 

$

36

 

Interest cost

 

 

1,000

 

 

 

951

 

 

 

1,115

 

 

 

43

 

 

 

49

 

 

 

49

 

 

 

44

 

 

 

40

 

 

 

39

 

Expected return on plan assets

 

 

(1,601

)

 

 

(1,505

)

 

 

(1,624

)

 

 

(52

)

 

 

(47

)

 

 

(46

)

 

 

—

 

 

 

—

 

 

 

—

 

Amortization of prior service credit

 

 

(105

)

 

 

(118

)

 

 

(118

)

 

 

(2

)

 

 

(2

)

 

 

(2

)

 

 

—

 

 

 

—

 

 

 

(1

)

Actuarial losses (gains) and other

 

 

888

 

 

 

3,537

 

 

 

37

 

 

 

(179

)

 

 

80

 

 

 

(38

)

 

 

85

 

 

 

265

 

 

 

(9

)

Net periodic benefit cost

 

$

950

 

 

$

3,554

 

 

$

89

 

 

$

(94

)

 

$

174

 

 

$

60

 

 

$

171

 

 

$

340

 

 

$

65

 

 

Amounts recognized in other comprehensive income were primarily related to amortization of prior service cost in our U.S. Pension Plans of $105 million in 2020 and $118 million in 2019 ($80 million, net of tax, in 2020 and $91 million, net of tax, in 2019).

 

Benefit payments, which reflect expected future service, are expected to be paid as follows for the years ending May 31 (in millions):

 

 

 

U.S. Pension Plans

 

 

International

Pension Plans

 

 

Postretirement

Healthcare Plans

 

2021

 

$

1,008

 

 

$

50

 

 

$

104

 

2022

 

 

1,093

 

 

 

46

 

 

 

113

 

2023

 

 

1,154

 

 

 

51

 

 

 

121

 

2024

 

 

1,242

 

 

 

57

 

 

 

126

 

2025

 

 

1,331

 

 

 

62

 

 

 

120

 

2026-2030

 

 

7,967

 

 

 

414

 

 

 

433

 

 

These estimates are based on assumptions about future events. Actual benefit payments may vary significantly from these estimates.

Future medical benefit claims costs are estimated to increase at an annual rate of 5.70% during 2021, decreasing to an annual growth rate of 4.50% in 2037 and thereafter.

v3.20.2
Business Segments and Disaggregated Revenue
 12 Months Ended
May 31, 2020
Segment Reporting Disclosure Of Entitys Reportable Segments [Abstract]  
Business Segments and Disaggregated Revenue

NOTE 14: BUSINESS SEGMENTS AND DISAGGREGATED REVENUE

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 Custom Critical Inc. (“FedEx Custom Critical”) (time-critical 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)

 

 

Effective June 1, 2019, the results of the FedEx Office operating segment are included in “Corporate, other and eliminations.” This change was made to reflect our internal management reporting structure. Prior year amounts have been revised to reflect current year presentation.

Effective March 1, 2020, the results of FedEx Custom Critical are included in the FedEx Express segment prospectively as the impact to prior periods was not material. This change was made to reflect our internal management reporting structure.

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 FedEx Express 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.

The FedEx Services segment provides direct and indirect support to our operating segments, and we allocate all of the net operating costs of the FedEx Services segment to reflect the full cost of operating our transportation businesses in the results of those segments. 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 operating 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 revenue 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 Office operating segment, which provides an array of document and business services and retail access to our customers for our package transportation businesses, and the FedEx Logistics operating segment, which provides integrated supply chain management solutions, specialty transportation, customs brokerage and global ocean and air freight forwarding.

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 revenue of the billing segment. These rates are adjusted from time to time based on market conditions. Such intersegment revenue 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 revenue, 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

 

 

Consolidated

Total

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

35,513

 

 

$

22,733

 

 

$

7,102

 

 

$

22

 

 

$

3,847

 

 

$

69,217

 

2019

 

 

37,331

 

 

 

20,522

 

 

 

7,582

 

 

 

22

 

 

 

4,236

 

 

 

69,693

 

2018

 

 

36,172

 

 

 

18,395

 

 

 

6,812

 

 

 

28

 

 

 

4,043

 

 

 

65,450

 

Depreciation and amortization

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

1,894

 

 

$

789

 

 

$

381

 

 

$

413

 

 

$

138

 

 

$

3,615

 

2019

 

 

1,801

 

 

 

728

 

 

 

332

 

 

 

355

 

 

 

137

 

 

 

3,353

 

2018

 

 

1,679

 

 

 

681

 

 

 

296

 

 

 

308

 

 

 

131

 

 

 

3,095

 

Operating income (loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020(1)

 

$

996

 

 

$

2,014

 

 

$

580

 

 

$

—

 

 

$

(1,173

)

 

$

2,417

 

2019(2)

 

 

2,176

 

 

 

2,663

 

 

 

615

 

 

 

—

 

 

 

(988

)

 

 

4,466

 

2018(3)

 

 

2,172

 

 

 

2,556

 

 

 

490

 

 

 

—

 

 

 

(946

)

 

 

4,272

 

Segment assets(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

41,252

 

 

$

24,700

 

 

$

6,434

 

 

$

7,285

 

 

$

(6,134

)

 

$

73,537

 

2019

 

 

33,247

 

 

 

17,561

 

 

 

4,736

 

 

 

6,061

 

 

 

(7,202

)

 

 

54,403

 

2018

 

 

31,753

 

 

 

15,458

 

 

 

4,251

 

 

 

5,501

 

 

 

(4,633

)

 

 

52,330

 

(1)

Includes TNT Express integration expenses of $270 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes noncash goodwill and other asset impairment charges of $435 million primarily related to goodwill impairment at FedEx Office and from the decision to permanently retire certain aircraft and related engines at FedEx Express.

(2)

Includes TNT Express integration expenses (including restructuring charges) of $388 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes business realignment costs of $320 million included in “Corporate, other and eliminations” and costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.

(3)

Includes TNT Express integration expenses (including restructuring charges) of $477 million. 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 included in “Corporate, other and eliminations.”

(4)

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

 

2020

 

$

3,560

 

 

 

$

1,083

 

 

$

539

 

 

$

527

 

 

$

159

 

 

$

5,868

 

2019

 

 

3,550

 

 

 

 

808

 

 

 

544

 

 

 

440

 

 

 

148

 

 

 

5,490

 

2018

 

 

3,461

 

 

 

 

1,178

 

 

 

490

 

 

 

411

 

 

 

123

 

 

 

5,663

 

 

The following table presents revenue by service type and geographic information for the years ended or as of May 31 (in millions):

 

 

2020

 

 

2019(1)

 

 

2018(1)

 

REVENUE BY SERVICE TYPE

 

 

 

 

 

 

 

 

 

 

 

 

FedEx Express segment:

 

 

 

 

 

 

 

 

 

 

 

 

Package:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. overnight box

 

$

7,234

 

 

$

7,663

 

 

$

7,273

 

U.S. overnight envelope

 

 

1,776

 

 

 

1,829

 

 

 

1,788

 

U.S. deferred

 

 

4,038

 

 

 

4,225

 

 

 

3,738

 

Total U.S. domestic package revenue

 

 

13,048

 

 

 

13,717

 

 

 

12,799

 

International priority

 

 

7,354

 

 

 

7,405

 

 

 

7,461

 

International economy

 

 

3,082

 

 

 

3,446

 

 

 

3,255

 

Total international export package revenue

 

 

10,436

 

 

 

10,851

 

 

 

10,716

 

International domestic(2)

 

 

4,179

 

 

 

4,540

 

 

 

4,637

 

Total package revenue

 

 

27,663

 

 

 

29,108

 

 

 

28,152

 

Freight:

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

 

2,998

 

 

 

3,025

 

 

 

2,797

 

International priority

 

 

1,915

 

 

 

2,070

 

 

 

2,105

 

International economy

 

 

1,930

 

 

 

2,123

 

 

 

1,916

 

International airfreight

 

 

270

 

 

 

314

 

 

 

368

 

Total freight revenue

 

 

7,113

 

 

 

7,532

 

 

 

7,186

 

Other(3)

 

 

737

 

 

 

691

 

 

 

834

 

Total FedEx Express segment

 

 

35,513

 

 

 

37,331

 

 

 

36,172

 

FedEx Ground segment

 

 

22,733

 

 

 

20,522

 

 

 

18,395

 

FedEx Freight segment

 

 

7,102

 

 

 

7,582

 

 

 

6,812

 

FedEx Services segment

 

 

22

 

 

 

22

 

 

 

28

 

Other and eliminations(4)

 

 

3,847

 

 

 

4,236

 

 

 

4,043

 

 

 

$

69,217

 

 

$

69,693

 

 

$

65,450

 

GEOGRAPHICAL INFORMATION(5)

 

 

 

 

 

 

 

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

$

48,404

 

 

$

47,584

 

 

$

43,581

 

International:

 

 

 

 

 

 

 

 

 

 

 

 

FedEx Express segment

 

 

19,177

 

 

 

20,424

 

 

 

20,417

 

FedEx Ground segment

 

 

479

 

 

 

467

 

 

 

407

 

FedEx Freight segment

 

 

192

 

 

 

207

 

 

 

181

 

FedEx Services segment

 

 

1

 

 

 

1

 

 

 

1

 

Other

 

 

964

 

 

 

1,010

 

 

 

863

 

Total international revenue

 

 

20,813

 

 

 

22,109

 

 

 

21,869

 

 

 

$

69,217

 

 

$

69,693

 

 

$

65,450

 

Noncurrent assets:

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

$

45,691

 

 

$

33,189

 

 

$

30,362

 

International

 

 

11,463

 

 

 

8,128

 

 

 

8,627

 

 

 

$

57,154

 

 

$

41,317

 

 

$

38,989

 

(1)

Prior year amounts have been revised to conform to the current year presentation.

(2)

International domestic revenue relates to our intra-country operations.

(3)

Includes the operations of FedEx Custom Critical.

(4)

Includes the FedEx Office and FedEx Logistics operating segments.

(5)

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.

v3.20.2
Supplemental Cash Flow Information
 12 Months Ended
May 31, 2020
Supplemental Cash Flow Information [Abstract]  
Supplemental Cash Flow Information

NOTE 15: SUPPLEMENTAL CASH FLOW INFORMATION

Cash paid for interest expense and income taxes for the years ended May 31 was as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Cash payments for:

 

 

 

 

 

 

 

 

 

 

 

 

Interest (net of capitalized interest)

 

$

639

 

 

$

617

 

 

$

524

 

Income taxes

 

$

389

 

 

$

407

 

 

$

760

 

Income tax refunds received

 

 

(353

)

 

 

(36

)

 

 

(571

)

Cash tax payments, net

 

$

36

 

 

$

371

 

 

$

189

 

 
v3.20.2
Guarantees and Indemnifications
 12 Months Ended
May 31, 2020
Guarantees And Indemnifications [Abstract]  
Guarantees and Indemnifications

NOTE 16: GUARANTEES AND INDEMNIFICATIONS

In conjunction with certain transactions, primarily the lease, sale or purchase of real estate, operating assets or services in the ordinary course of business and in connection with business sales and acquisitions, we may provide routine guarantees or indemnifications (e.g., environmental, fuel, tax and intellectual property infringement), the terms of which range in duration, and often they are not limited and have no specified maximum obligation. As a result of the TNT Express acquisition, we have assumed a guarantee related to the demerger of TNT Express and PostNL Holding B.V., which occurred in 2011, for pension benefits earned prior to the date of the demerger. The risk of making payments associated with this guarantee is remote. The overall maximum potential amount of the obligation under such guarantees and indemnifications cannot be reasonably estimated. Historically, we have not been required to make significant payments under our guarantee or indemnification obligations and no material amounts have been recognized in our financial statements for the underlying fair value of these obligations.

v3.20.2
Commitments
 12 Months Ended
May 31, 2020
Commitments [Abstract]  
Commitments

NOTE 17: COMMITMENTS

Annual purchase commitments under various contracts as of May 31, 2020 were as follows (in millions):

 

 

 

Aircraft and

Aircraft Related

 

 

Other(1)

 

 

Total

 

2021

 

$

2,177

 

 

$

949

 

 

$

3,126

 

2022

 

 

2,772

 

 

 

590

 

 

 

3,362

 

2023

 

 

2,036

 

 

 

407

 

 

 

2,443

 

2024

 

 

697

 

 

 

263

 

 

 

960

 

2025

 

 

660

 

 

 

226

 

 

 

886

 

Thereafter

 

 

2,723

 

 

 

397

 

 

 

3,120

 

Total

 

$

11,065

 

 

$

2,832

 

 

$

13,897

 

(1)

Primarily equipment and advertising contracts.

The amounts reflected in the table above for purchase commitments represent noncancelable agreements to purchase goods or services. As of May 31, 2020, our obligation to purchase one Boeing 767-300 Freighter (“B767F”) aircraft and six Boeing 777 Freighter (“B777F”) aircraft is conditioned upon there being no event that causes FedEx Express or its employees not to be covered by the Railway Labor Act of 1926, as amended. Open purchase orders that are cancelable are not considered unconditional purchase obligations for financial reporting purposes and are not included in the table above.

We have several aircraft modernization programs underway that are supported by the purchase of B777F and B767F aircraft. These aircraft are significantly more fuel-efficient per unit than the aircraft types previously utilized, and these expenditures are necessary to achieve significant long-term operating savings and to replace older aircraft. Our ability to delay the timing of these aircraft-related expenditures is limited without incurring significant costs to modify existing purchase agreements.

As of May 31, 2020, we had $633 million in deposits and progress payments on aircraft purchases and other planned aircraft-related transactions. These deposits are classified in the “Other assets” caption of our accompanying consolidated balance sheets. Aircraft and aircraft-related contracts are subject to price escalations. The following table is a summary of the key aircraft we are committed to purchase as of May 31, 2020, with the year of expected delivery:

 

 

 

Cessna SkyCourier 408

 

 

ATR 72-600F

 

 

B767F

 

 

B777F

 

 

Total

 

2021

 

 

—

 

 

 

4

 

 

 

20

 

 

 

2

 

 

 

26

 

2022

 

 

9

 

 

 

7

 

 

 

18

 

 

 

5

 

 

 

39

 

2023

 

 

12

 

 

 

6

 

 

 

8

 

 

 

2

 

 

 

28

 

2024

 

 

12

 

 

 

6

 

 

 

—

 

 

 

4

 

 

 

22

 

2025

 

 

12

 

 

 

6

 

 

 

—

 

 

 

2

 

 

 

20

 

Thereafter

 

 

5

 

 

 

1

 

 

 

—

 

 

 

—

 

 

 

6

 

Total

 

 

50

 

 

 

30

 

 

 

46

 

 

 

15

 

 

 

141

 

 

During 2020, FedEx Express exercised options to purchase an additional six B767F aircraft for delivery in 2022. Additionally, FedEx Express executed two contract amendments rescheduling two B777F aircraft deliveries from 2023 to 2022 and two B767F aircraft deliveries from 2022 to 2023.

 

In the fourth quarter of 2020, we received notice from certain aircraft manufacturers (i) rescheduling four B767F aircraft deliveries from 2020 to 2021, as well as two B767F aircraft deliveries from 2021 to 2022, and (ii) rescheduling certain Cessna SkyCourier 408 and ATR 72-600F aircraft between 2021 and 2026.

 

On June 25, 2020, FedEx Express executed a contract amendment rescheduling B767F aircraft deliveries as follows: 2021 – 18 aircraft; 2022 – 11 aircraft; 2023 – 13 aircraft; and 2024 – 4 aircraft.
v3.20.2
Contingencies
 12 Months Ended
May 31, 2020
Loss Contingency [Abstract]  
Contingencies

NOTE 18: CONTINGENCIES

Service Provider Lawsuits. FedEx Ground is defending lawsuits in which it is alleged that FedEx Ground should be treated as a joint employer of drivers employed by service providers engaged by FedEx Ground. These cases are in varying stages of litigation, and we are not currently able to estimate an amount or range of potential loss in all of these matters. However, we do not expect to incur, individually or in the aggregate, a material loss in these matters. Nevertheless, adverse determinations in these matters could, among other things, entitle service providers’ drivers to certain wage payments from the service providers and FedEx Ground, and result in employment and withholding tax and benefit liability for FedEx Ground. We continue to believe that FedEx Ground is not an employer or joint employer of the drivers of these independent businesses.

 

Federal Securities Litigation and Derivative Lawsuits. On June 26, 2019 and July 2, 2019, FedEx and certain present and former officers were named as defendants in two putative class action securities lawsuits filed in the U.S. District Court for the Southern District of New York. The complaints, which have been consolidated, allege violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder relating to alleged misstatements or omissions in FedEx’s public filings with the SEC and other public statements during the period from September 19, 2017 to December 18, 2018. We are not currently able to estimate the probability of loss or the amount or range of potential loss, if any, at this stage of the litigation.

 

On September 17, 2019 and November 6, 2019, FedEx, its Board of Directors and certain present and former directors and officers were named as defendants in two stockholder derivative lawsuits filed in the U.S. District Court for the District of Delaware. The complaints, which were subsequently consolidated, repeated the allegations in the federal securities litigation complaints, and asserted new claims against the FedEx Board of Directors and certain present and former directors and officers for breach of fiduciary duty, waste of corporate assets, unjust enrichment, insider selling and violations of the federal securities laws. On June 24, 2020, the consolidated lawsuit was dismissed with prejudice. Any appeal of the dismissal must be made by July 24, 2020.

 

Derivative Lawsuit Related to New York Cigarette Litigation. On October 3, 2019, FedEx and certain present and former FedEx directors and officers were named as defendants in a stockholder derivative lawsuit filed in the Delaware Court of Chancery. The complaint alleges the defendants breached their fiduciary duties in connection with the activities alleged in lawsuits filed by the City of New York and the State of New York against FedEx Ground in December 2013 and November 2014 and against FedEx Ground and FedEx Freight in July 2017. The underlying lawsuits related to the alleged shipment of cigarettes to New York residents in contravention of several statutes, as well as common law nuisance claims, and were dismissed by the court in December 2018 following entry into a final settlement agreement for approximately $35 million. The settlement did not include any admission of liability by FedEx Ground or FedEx Freight. In addition to the settlement amount, we recognized approximately $10 million for certain attorney’s fees in connection with the underlying lawsuits. We are not currently able to estimate the probability of loss or the amount or range of potential loss, if any, at this stage of the lawsuit. On August 14, 2019, a separate stockholder derivative lawsuit alleging similar breaches of fiduciary duty was filed in the Delaware Court of Chancery. The plaintiff voluntarily dismissed this lawsuit on June 25, 2020.

 

Environmental Matters. SEC regulations require disclosure of certain environmental matters when a governmental authority is a party to the proceedings and the proceedings involve potential monetary sanctions that management reasonably believes could exceed $100,000.

 

Prior to our acquisition of TNT Express, a lawsuit was filed in Simões Filho, Bahia, Brazil against a subsidiary of TNT Express alleging violations of Brazilian environmental laws. Specifically, the lawsuit alleges that in 2012, certain employees unlawfully discarded non-toxic trash on a highway. We could be subject to monetary sanctions and fines related to such activity that exceed $100,000. We believe that the aggregate amount of any such sanctions and fines will be immaterial.

 

Other Matters. FedEx and its subsidiaries are subject to other legal proceedings that arise in the ordinary course of business, including certain lawsuits containing various class-action allegations of wage-and-hour violations in which plaintiffs claim, among other things, that they were forced to work “off the clock,” were not paid overtime or were not provided work breaks or other benefits. In the opinion of management, the aggregate liability, if any, with respect to these other actions will not have a material adverse effect on our financial position, results of operations or cash flows.
v3.20.2
Related Party Transactions
 12 Months Ended
May 31, 2020
Related Party Transactions [Abstract]  
Related Party Transactions

NOTE 19: RELATED PARTY TRANSACTIONS

Our Chairman and Chief Executive Officer, Frederick W. Smith, currently holds an approximate 10% ownership interest in the Washington, D.C. National Football League professional football team and is a member of its board of directors. FedEx has a multi-year naming rights agreement with Washington Football, Inc. granting us certain marketing rights, including the right to name the stadium where the team plays and other events are held “FedExField.”

v3.20.2
Summary of Quarterly Operating Results (Unaudited)
 12 Months Ended
May 31, 2020
Quarterly Financial Information Disclosure [Abstract]  
Summary of Quarterly Operating Results (Unaudited)

NOTE 20: SUMMARY OF QUARTERLY OPERATING RESULTS (UNAUDITED)

 

(in millions, except per share amounts)

 

First

Quarter

 

 

Second

Quarter

 

 

Third

Quarter

 

 

Fourth

Quarter

 

2020(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

17,048

 

 

$

17,324

 

 

$

17,487

 

 

$

17,358

 

Operating income

 

 

977

 

 

 

554

 

 

 

411

 

 

 

475

 

Net income (loss)(2)

 

 

745

 

 

 

560

 

 

 

315

 

 

 

(334

)

Basic earnings (loss) per common share(3)

 

 

2.86

 

 

 

2.15

 

 

 

1.21

 

 

 

(1.28

)

Diluted earnings (loss) per common share(3)

 

 

2.84

 

 

 

2.13

 

 

 

1.20

 

 

 

(1.28

)

2019(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

17,052

 

 

$

17,824

 

 

$

17,010

 

 

$

17,807

 

Operating income

 

 

1,071

 

 

 

1,168

 

 

 

911

 

 

 

1,316

 

Net income (loss)(5)

 

 

835

 

 

 

935

 

 

 

739

 

 

 

(1,969

)

Basic earnings (loss) per common share(3)

 

 

3.15

 

 

 

3.56

 

 

 

2.83

 

 

 

(7.56

)

Diluted earnings (loss) per common share(3)

 

 

3.10

 

 

 

3.51

 

 

 

2.80

 

 

 

(7.56

)

(1)

The fourth quarter, third quarter, second quarter and first quarter of 2020 include $63 million, $72 million, $64 million and $71 million, respectively, of TNT Express integration expenses. The fourth quarter includes $369 million of goodwill and other asset impairment charges associated with the FedEx Office and FedEx Logistics operating segments and a net loss of $794 million related to the annual MTM retirement plans accounting adjustment. The second quarter of 2020 includes asset impairment charges of $66 million related to the permanent retirement of 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express.

(2)

The fourth quarter of 2020 includes a tax benefit of $71 million in connection with the 2020 U.S. tax loss that can be offset against income in prior years under the CARES Act and a tax expense of $51 million due to a change in deferred tax balances related to foreign tax operations. The second quarter of 2020 includes a tax benefit of $133 million from the reduction of a valuation allowance on certain foreign tax loss carryforwards.   

(3)

The sum of the quarterly earnings per share may not equal annual amounts due to differences in the weighted-average number of shares outstanding during the respective periods.

(4)

The fourth quarter, third quarter, second quarter and first quarter of 2019 include $84 million, $69 million, $114 million and $121 million, respectively, of TNT Express integration expenses (including any restructuring charges). The fourth quarter and third quarter of 2019 include business realignment costs of $316 million and $4 million, respectively. The fourth quarter includes a net loss of $3.9 billion related to the annual MTM retirement plans accounting adjustment. The second quarter of 2019 includes costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.

(5)

The third quarter of 2019 includes a tax benefit of $90 million from the reduction of a valuation allowance on certain tax loss carryforwards and a tax expense of $50 million related to a lower tax rate in the Netherlands applied to our deferred tax balances. The second quarter of 2019 includes a tax benefit of approximately $60 million from accelerated deductions claimed on our 2018 U.S. income tax return. In addition, we recognized a tax expense of $4 million in the second quarter of 2019 as a revision of the provisional benefit associated with the remeasurement of our net U.S. deferred tax liability upon completion of the accounting for the tax effects of the TCJA.
v3.20.2
Valuation and Qualifying Accounts
 12 Months Ended
May 31, 2020
Valuation And Qualifying Accounts [Abstract]  
Schedule Of Valuation And Qualifying Accounts

SCHEDULE II

FEDEX CORPORATION

VALUATION AND QUALIFYING ACCOUNTS

FOR THE YEARS ENDED MAY 31, 2020, 2019 AND 2018

(IN MILLIONS)

 

 

 

 

 

 

 

ADDITIONS

 

 

 

 

 

 

 

 

 

DESCRIPTION

 

BALANCE

AT

BEGINNING

OF YEAR

 

 

CHARGED

TO

EXPENSES

 

 

CHARGED

TO

OTHER

ACCOUNTS

 

 

DEDUCTIONS

 

 

BALANCE

AT

END OF

YEAR

 

Accounts Receivable Reserves:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Doubtful Accounts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

121

 

 

$

442

 

 

$

—

 

 

$

388

 

(a)

 

175

 

2019

 

 

199

 

 

 

295

 

 

 

—

 

 

 

373

 

(a)

 

121

 

2018

 

 

115

 

 

 

246

 

 

 

—

 

 

 

162

 

(a)

 

199

 

Allowance for Revenue Adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

179

 

 

$

—

 

 

$

1,286

 

(b)

$

1,250

 

(c)

$

215

 

2019

 

 

202

 

 

 

—

 

 

 

1,192

 

(b)

 

1,215

 

(c)

 

179

 

2018

 

 

137

 

 

 

—

 

 

 

1,173

 

(b)

 

1,108

 

(c)

 

202

 

Inventory Valuation Allowance:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

335

 

 

$

33

 

 

$

—

 

 

$

33

 

 

$

335

 

2019

 

 

268

 

 

 

28

 

 

 

75

 

 

 

36

 

 

 

335

 

2018

 

 

237

 

 

 

27

 

 

 

6

 

 

 

2

 

 

 

268

 

(a)

Uncollectible accounts written off, net of recoveries, and other adjustments.

(b)

Principally charged against revenue.

(c)

Service failures, rebills and other.

v3.20.2
Description of Business Segments and Summary of Significant Accounting Policies (Policies)
 12 Months Ended
May 31, 2020
Accounting Policies [Abstract]  
Description of Business Segments DESCRIPTION OF BUSINESS SEGMENTS. FedEx Corporation (“FedEx”) provides a broad portfolio of transportation, e-commerce and business services through companies competing collectively, operating independently and managed collaboratively, under the respected FedEx brand. Our primary operating companies are Federal Express Corporation (“FedEx Express”), the world’s largest express transportation company; FedEx Ground Package System, Inc. (“FedEx Ground”), a leading North American provider of small-package ground delivery services; and FedEx Freight Corporation (“FedEx Freight”), a leading North American provider of less-than-truckload (“LTL”) freight transportation. These companies represent our major service lines and, along with FedEx Corporate Services, Inc. (“FedEx Services”), constitute our reportable segments. Our FedEx Services segment provides sales, marketing, information technology, communications, customer service, technical support, billing and collection services, and certain back-office functions that support our transportation segments (FedEx Express, FedEx Ground and FedEx Freight) and other business units.
Fiscal Years FISCAL YEARS. Except as otherwise specified, references to years indicate our fiscal year ended May 31, 2020 or ended May 31 of the year referenced.
Reclassifications

RECLASSIFICATIONS. Certain reclassifications have been made to the prior years’ consolidated financial statements to conform to the current year’s presentation.
Principles of Consolidation PRINCIPLES OF CONSOLIDATION. The consolidated financial statements include the accounts of FedEx and its subsidiaries, substantially all of which are wholly owned. All significant intercompany accounts and transactions have been eliminated in consolidation.
Revenue Recognition

REVENUE RECOGNITION. 

Satisfaction of Performance Obligation

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, and is the basis of revenue recognition in accordance with U.S. generally accepted accounting principles (“GAAP”). To determine the proper revenue recognition method for contracts, we evaluate whether two or more contracts should be combined and accounted for as one single contract and whether the combined or single contract should be accounted for as more than one performance obligation. For most of our contracts, the customer contracts with us to provide distinct services within a single contract, primarily transportation services. Substantially all of our contracts with customers for transportation services include only one performance obligation, the transportation services themselves. However, if a contract is separated into more than one performance obligation, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. We frequently sell standard transportation services with observable standalone sales prices. In these instances, the observable standalone sales are used to determine the standalone selling price.

For transportation services, revenue is recognized over time as we perform the services in the contract because of the continuous transfer of control to the customer. Our customers receive the benefit of our services as the goods are transported from one location to another. If we were unable to complete delivery to the final location, another entity would not need to reperform the transportation service already performed. As control transfers over time, revenue is recognized based on the extent of progress towards completion of the performance obligation. The selection of the method to measure progress towards completion requires judgment and is based on the nature of the products or services to be provided. We use the cost-to-cost measure of progress for our package delivery contracts because it best depicts the transfer of control to the customer which occurs as we incur costs on our contracts. Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation. Revenue, including ancillary or accessorial fees and reductions for estimated customer incentives, is recorded proportionally as costs are incurred. Costs to fulfill include labor and other direct costs and an allocation of indirect costs. For our freight and freight forwarding contracts, an output method of progress based on time-in-transit is utilized as the timing of costs incurred does not best depict the transfer of control to the customer.

We also provide customized customer-specific solutions, such as supply chain management solutions and inventory and service parts logistics, through which we provide the service of integrating a complex set of tasks and components into a single capability. For these arrangements, the majority of which are conducted by our FedEx Logistics, Inc. (“FedEx Logistics”) operating segment, the entire contract is accounted for as one performance obligation. For these performance obligations, we typically have a right to consideration from customers in an amount that corresponds directly with the value to the customers of our performance completed to date, and as such we recognize revenue in the amount to which we have a right to invoice the customer.

Contract Modification

Contracts are often modified to account for changes in the rates we charge our customers or to add additional distinct services. We consider contract modifications to exist when the modification either creates new enforceable rights and obligations or alters the existing arrangement. Contract modifications that add distinct goods or services are treated as separate contracts. Contract modifications that do not add distinct goods or services typically change the price of existing services. These contract modifications are accounted for prospectively as the remaining performance obligations are distinct.

Variable Consideration

Certain contracts contain customer incentives, guaranteed service refunds and other provisions that can either increase or decrease the transaction price. These incentives are generally awarded based upon achieving certain performance metrics. We estimate variable consideration as the most likely amount to which we expect to be entitled. We include estimated amounts of revenue, which may be reduced by incentives or other contract provisions, in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Our estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based on an assessment of anticipated customer spending and all information (historical, current and forecasted) that is reasonably available to us.

Principal vs. Agent Considerations

Transportation services are provided with the use of employees and independent businesses that contract with FedEx. GAAP requires us to evaluate whether our businesses themselves promise to transfer services to the customer (as the principal) or to arrange for services to be provided by another party (as the agent) using a control model. Based on our evaluation of the control model, we determined that FedEx is the principal to the transaction for most of these services and revenue is recognized on a gross basis based on the transfer of control to the customer. Costs associated with independent businesses providing transportation services are recognized as incurred and included in the caption “Purchased transportation” in the accompanying consolidated statements of income.

Our contract logistics, global trade services and certain transportation businesses engage in certain transactions wherein they act as agents. Revenue from these transactions is recorded on a net basis. Net revenue includes billings to customers less third-party charges, including transportation or handling costs, fees, commissions and taxes and duties.

Contract Assets and Liabilities

Contract assets include billed and unbilled amounts resulting from in-transit shipments, as we have an unconditional right to payment only once all performance obligations have been completed (e.g., packages have been delivered). Contract assets are generally classified as current and the full balance is converted each quarter based on the short-term nature of the transactions. Our contract liabilities consist of advance payments and billings in excess of revenue. The full balance of deferred revenue is converted each quarter based on the short-term nature of the transactions.

Gross contract assets related to in-transit shipments totaled $563 million and $533 million at May 31, 2020 and May 31, 2019, respectively. Contract assets, net of deferred unearned revenue were $456 million and $364 million at May 31, 2020 and May 31, 2019, respectively. Contract assets are included within current assets in the accompanying consolidated balance sheets. Contract liabilities related to advance payments from customers were $10 million and $11 million at May 31, 2020 and May 31, 2019, respectively. Contract liabilities are included within current liabilities in the accompanying consolidated balance sheets.

Payment terms

Certain of our revenue-producing transactions are subject to taxes, such as sales tax, assessed by governmental authorities. We present these revenues net of tax. Under the typical payment terms of our customer contracts, the customer pays at periodic intervals (e.g., every 15 days, 30 days, 45 days, etc.) for shipments included on invoices received. It is not customary business practice to extend payment terms past 90 days, and as such, we do not have a practice of including a significant financing component within our revenue contracts with customers.

Disaggregation of Revenue

See Note 14 for disclosure of disaggregated revenue for the periods ended May 31. This presentation is consistent with how we organize our segments internally for making operating decisions and measuring performance.
Credit Risk CREDIT RISK. We routinely grant credit to many of our customers for transportation and business services without collateral. The risk of credit loss in our trade receivables is substantially mitigated by our credit evaluation process, short collection terms and sales to a large number of customers, as well as the low revenue per transaction for most of our services. Allowances for potential credit losses are determined based on historical experience and the impact of current economic conditions. Historically, credit losses have been within management’s expectations.
Advertising ADVERTISING. Advertising and promotion costs are expensed as incurred and are classified in other operating expenses. Advertising and promotion expenses were $427 million in 2020, $468 million in 2019 and $442 million in 2018.
Cash Equivalents CASH EQUIVALENTS. Cash in excess of current operating requirements is invested in short-term, interest-bearing instruments with maturities of three months or less at the date of purchase and is stated at cost, which approximates market value.
Spare Parts, Supplies And Fuel SPARE PARTS, SUPPLIES AND FUEL. Spare parts (principally aircraft-related) are reported at weighted-average cost. Allowances for obsolescence are provided for spare parts currently identified as excess or obsolete as well as expected to be on hand at the date the aircraft are retired from service. These allowances are provided over the estimated useful life of the related aircraft and engines. The majority of our supplies and fuel are reported at weighted-average cost.
Property And Equipment

PROPERTY AND EQUIPMENT. Expenditures for major additions, improvements and flight equipment modifications are capitalized when such costs are determined to extend the useful life of the asset or are part of the cost of acquiring the asset. Expenditures for equipment overhaul costs of engines or airframes prior to their operational use are capitalized as part of the cost of such assets as they are costs required to ready the asset for its intended use. Maintenance and repairs costs are charged to expense as incurred, except for certain aircraft engine maintenance costs incurred under third-party service agreements. These agreements result in costs being expensed based on cycles or hours flown and are subject to annual escalation. These service contracts transfer risk to third-party service providers and generally fix the amount we pay for maintenance to the service provider as a rate per cycle or flight hour, in exchange for maintenance and repairs under a predefined maintenance program. We capitalize certain direct internal and external costs associated with the development of internal-use software. Gains and losses on sales of property used in operations are classified within operating expenses and historically have been nominal.

For financial reporting purposes, we record depreciation and amortization of property and equipment on a straight-line basis over the asset’s service life or related lease term, if shorter. For income tax purposes, depreciation is computed using accelerated methods when applicable.

The depreciable lives and net book value of our property and equipment are as follows (dollars in millions):

 

 

 

 

 

Net Book Value at May 31,

 

 

 

Range

 

2020

 

 

2019

 

Wide-body aircraft and related equipment

 

15 to 30 years

 

$

13,448

 

 

$

11,975

 

Narrow-body and feeder aircraft and related equipment

 

5 to 18 years

 

 

2,478

 

 

 

2,696

 

Package handling and ground support equipment

 

3 to 30 years

 

 

4,499

 

 

 

4,157

 

Information technology

 

2 to 10 years

 

 

1,795

 

 

 

1,553

 

Vehicles and trailers

 

3 to 15 years

 

 

4,345

 

 

 

4,042

 

Facilities and other

 

2 to 40 years

 

 

7,043

 

 

 

6,006

 

 

Substantially all property and equipment have no material residual values. The majority of aircraft costs are depreciated on a straight-line basis over 15 to 30 years. We periodically evaluate the estimated service lives and residual values used to depreciate our property and equipment. 

Depreciation and amortization expense, excluding gains and losses on sales of property and equipment used in operations, was $3.6 billion in 2020, $3.4 billion in 2019 and $3.1 billion in 2018. Depreciation and amortization expense includes amortization of assets under finance lease.

Capitalized Interest CAPITALIZED INTEREST. Interest on funds used to finance the acquisition and modification of aircraft, including purchase deposits, construction of certain facilities, and development of certain software up to the date the asset is ready for its intended use, is capitalized and included in the cost of the asset if the asset is actively under construction. Capitalized interest was $54 million in 2020, $64 million in 2019 and $61 million in 2018.
Impairment of Long-Lived Assets

IMPAIRMENT OF LONG-LIVED ASSETS. Long-lived assets are reviewed for impairment when circumstances indicate the carrying value of an asset may not be recoverable. For assets that are to be held and used, an impairment is recognized when the estimated undiscounted cash flows associated with the asset or group of assets is less than their carrying value. If impairment exists, an adjustment is made to write the asset down to its fair value, and a loss is recorded as the difference between the carrying value and fair value. Fair values are determined based on quoted market values, discounted cash flows or internal and external appraisals, as applicable. Assets to be disposed of are carried at the lower of carrying value or estimated net realizable value.

We operate integrated transportation networks so cash flows for most of our operating assets to be held and used are assessed at a network level, not at an individual asset level, for our analysis of impairment.

In the second quarter of 2020, we made the decision to permanently retire from service 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express to align with the needs of the U.S. domestic network and modernize its aircraft fleet. As a consequence of this decision, we recognized noncash impairment charges of $66 million ($50 million, net of tax, or $0.19 per diluted share) in the FedEx Express segment in the second quarter of 2020. Seven of these aircraft had been temporarily idled.

In the normal management of our aircraft fleet, we routinely idle aircraft and engines temporarily due to maintenance cycles and adjustments of our network capacity to match seasonality and overall customer demand levels. Temporarily idled assets are classified as available-for-use, and we continue to record depreciation expense associated with these assets. These temporarily idled assets are assessed for impairment and remaining life on a quarterly basis. The criteria for determining whether an asset has been permanently removed from service (and, as a result, is potentially impaired) include, but are not limited to, our global economic outlook and the impact of our outlook on our current and projected volume levels, including capacity needs during our peak shipping seasons; the introduction of new fleet types or decisions to permanently retire an aircraft fleet from operations; and changes to planned service expansion activities. At May 31, 2020, we had 14 aircraft temporarily idled. These aircraft have been idled for an average of five months and are expected to return to revenue service.
Sale of Business

SALE OF BUSINESS. During 2018, we sold a non-core business of TNT Express B.V. (“TNT Express”) and recorded a gain of $85 million in the FedEx Express segment.
Goodwill and Intangible Assets

GOODWILL. Goodwill is recognized for the excess of the purchase price over the fair value of tangible and identifiable intangible net assets of businesses acquired. Several factors give rise to goodwill in our acquisitions, such as the expected benefits from synergies of the combination and the existing workforce of the acquired business. Goodwill is reviewed at least annually for impairment. In our evaluation of goodwill impairment, we perform a qualitative assessment to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the qualitative assessment is not conclusive, we proceed to test goodwill for impairment, including comparing the fair value of the reporting unit to its carrying value (including attributable goodwill). Fair value for our reporting units is determined using an income or market approach incorporating market participant considerations and management’s assumptions on revenue growth rates, operating margins, discount rates and expected capital expenditures. Fair value determinations may include both internal and third-party valuations. Unless circumstances otherwise dictate, we perform our annual impairment testing in the fourth quarter.

See Note 4 for additional information.

INTANGIBLE ASSETS. Intangible assets primarily include customer relationships, technology assets and trademarks acquired in business combinations. Intangible assets are amortized over periods ranging from 3 to 15 years, either on a straight-line basis or on a basis consistent with the pattern in which the economic benefits are realized.

Pension and Postretirement Healthcare Plans

PENSION AND POSTRETIREMENT HEALTHCARE PLANS. Our defined benefit pension and other postretirement benefit plans are measured using actuarial techniques that reflect management’s assumptions for discount rate, investment returns on plan assets, salary increases, expected retirement, mortality, employee turnover and future increases in healthcare costs. We determine the discount rate (which is required to be the rate at which the projected benefit obligation (“PBO”) could be effectively settled as of the measurement date) with the assistance of actuaries, who calculate the yield on a theoretical portfolio of high-grade corporate bonds (rated Aa or better) with cash flows that are designed to match our expected benefit payments in future years. We use the fair value of plan assets to calculate the expected return on assets (“EROA”) for interim and segment reporting purposes. Our EROA is a judgmental estimate which is reviewed on an annual basis and revised as appropriate.

The accounting guidance related to employers’ accounting for defined benefit pension and other postretirement plans requires recognition in the balance sheet of the funded status of these plans. We use “mark-to-market” or MTM accounting and immediately recognize changes in the fair value of plan assets and actuarial gains or losses in our results annually in the fourth quarter each year. The annual MTM adjustment is recognized at the corporate level and does not impact segment results. The remaining components of pension and postretirement healthcare expense, primarily service and interest costs and the EROA, are recorded on a quarterly basis. Only service cost is recognized in segment level operating results.
Income Taxes

INCOME TAXES. Deferred income taxes are provided for the tax effect of temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements. The liability method is used to account for income taxes, which requires deferred taxes to be recorded at the statutory rate expected to be in effect when the taxes are paid.

Deferred income tax assets represent amounts available to reduce income taxes payable on taxable income in future years. Such assets arise because of temporary differences between the financial reporting and tax bases of assets and liabilities, as well as from net operating loss and tax credit carryforwards. We evaluate the recoverability of these future tax deductions and credits by assessing the adequacy of future expected taxable income from all sources, including reversal of taxable temporary differences, forecasted operating earnings and available tax planning strategies. These sources of income rely heavily on estimates to make this determination and, thus, there is a risk that these estimates will have to be revised as new information is received. To the extent we do not consider it more likely than not that a deferred tax asset will be recovered, a valuation allowance is established. We believe we will generate sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets in our consolidated balance sheets that are not subject to valuation allowances. We record the taxes for global intangible low-taxed income as a period cost.

We recognize liabilities for uncertain income tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step requires us to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as we must determine the probability of various possible outcomes. We reevaluate these uncertain tax positions on a quarterly basis or when new information becomes available to management. These reevaluations are based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, successfully settled issues under audit and new audit activity. Such a change in recognition or measurement could result in the recognition of a tax benefit or an increase to the related provision.

We classify interest related to income tax liabilities as interest expense, and if applicable, penalties are recognized as a component of income tax expense. The income tax liabilities and accrued interest and penalties that are due within one year of the balance sheet date are presented as current liabilities. The noncurrent portion of our income tax liabilities and accrued interest and penalties are recorded in the caption “Other liabilities” in the accompanying consolidated balance sheets.

Self-Insurance Accruals

SELF-INSURANCE ACCRUALS. We are self-insured for costs associated with workers’ compensation claims, vehicle accidents and general business liabilities, and benefits paid under employee healthcare and disability programs. Accruals are primarily based on the actuarially estimated cost of claims, which includes incurred-but-not-reported claims. Current workers’ compensation claims, vehicle and general liability, employee healthcare claims and long-term disability are included in accrued expenses. We self-insure up to certain limits that vary by operating company and type of risk. Periodically, we evaluate the level of insurance coverage and adjust insurance levels based on risk tolerance and premium expense.

Leases

LEASES. We lease certain facilities, aircraft, equipment and vehicles under operating and finance leases. A determination of whether a contract contains a lease is made at the inception of the arrangement. Our leased facilities include national, regional and metropolitan sorting facilities, retail facilities and administrative buildings.

Our leases generally contain options to extend or terminate the lease. We reevaluate our leases on a regular basis to consider the economic and strategic incentives of exercising the renewal options, and how they align with our operating strategy. Therefore, substantially all the renewal option periods are not included within the lease term and the associated payments are not included in the measurement of the right-of-use asset and lease liability as the options to extend are not reasonably certain at lease commencement.

The lease liabilities are measured at the lease commencement date and determined using the present value of the minimum lease payments not yet paid and our incremental borrowing rate, which approximates the rate at which we would borrow, on a collateralized basis, over the term of a lease in the applicable currency environment. The interest rate implicit in the lease is generally not determinable in transactions where we are the lessee.

For real estate leases, we account for lease components and non-lease components (such as common area maintenance) as a single lease component. Certain real estate leases require additional payments based on sales volume and index-based rate increases, as well as reimbursement for real estate taxes, common area maintenance and insurance, which are expensed as incurred as variable lease costs. Certain leases contain fixed lease payments for items such as real estate taxes, common area maintenance and insurance. These fixed payments are considered part of the lease payment and included in the right-of-use assets and lease liabilities.

See Note 7 for additional information.
Deferred Gains

DEFERRED GAINS. Prior to the adoption of ASU 2016-02 on June 1, 2019, gains on the sale and leaseback of aircraft and other property and equipment were deferred and amortized ratably over the life of the lease as a reduction of rent expense. Substantially all of these deferred gains, which are included in other non-current liabilities, related to aircraft transactions.

Derivative Financial Instruments

DERIVATIVE FINANCIAL INSTRUMENTS. Our risk management strategy includes the select use of derivative instruments to reduce the effects of volatility in foreign currency exchange exposure on operating results and cash flows. In accordance with our risk management policies, we do not hold or issue derivative instruments for trading or speculative purposes. All derivative instruments are recognized in the financial statements at fair value, regardless of the purpose or intent for holding them.

When we become a party to a derivative instrument and intend to apply hedge accounting, we formally document the hedge relationship and the risk management objective for undertaking the hedge, which includes designating the instrument for financial reporting purposes as a fair value hedge, a cash flow hedge, or a net investment hedge.

If a derivative is designated as a cash flow hedge, the entire change in the fair value of the hedging instrument included in the assessment of hedge effectiveness is recorded in other comprehensive income. For net investment hedges, the entire change in the fair value is recorded in other comprehensive income. Any portion of a change in the fair value of a derivative that is considered to be ineffective, along with the change in fair value of any derivatives not designated in a hedging relationship, is immediately recognized in the income statement. We do not have any derivatives designated as a cash flow hedge for any period presented. During 2020, we designated €392 million of debt as a net investment hedge to reduce the volatility of the U.S. dollar value of a portion of our net investment in a euro-denominated consolidated subsidiary. As of May 31, 2020, the hedge remains effective.

Foreign Currency Translation

FOREIGN CURRENCY TRANSLATION. Translation gains and losses of foreign operations that use local currencies as the functional currency are accumulated and reported, net of applicable deferred income taxes, as a component of Accumulated Other Comprehensive Income (“AOCI”) within common stockholders’ investment. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the local currency are included in the caption “Other, net” in the accompanying consolidated statements of income and were immaterial for each period presented.

Stock-Based Compensation

STOCK-BASED COMPENSATION. The accounting guidance related to share-based payments requires recognition of compensation expense for stock-based awards using a fair value method. We use the Black-Scholes option pricing model to calculate the fair value of stock options. The value of restricted stock awards is based on the stock price of the award on the grant date. We record stock-based compensation expense in the “Salaries and employee benefits” caption in the accompanying consolidated statements of income. We issue new shares or treasury shares from stock repurchases to cover employee stock option exercises and restricted stock grants.

Business Realignment Costs

BUSINESS REALIGNMENT COSTS. During 2019, we conducted a program to offer voluntary cash buyouts to eligible U.S.-based employees in certain staff functions. As a result of this program, approximately 1,500 employees left the Company. Costs of the benefits provided under the U.S.-based voluntary employee buyout program were recognized in 2019 when eligible employees accepted their offers. Payments under this program were made at the time of departure and totaled approximately $50 million in 2020 and $220 million in 2019.
Use of Estimates

USE OF ESTIMATES. The preparation of our consolidated financial statements requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of revenue and expenses and the disclosure of contingent liabilities. Management makes its best estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Changes in estimates are recognized in accordance with the accounting rules for the estimate, which is typically in the period when new information becomes available to management. Areas where the nature of the estimate makes it reasonably possible that actual results could materially differ from amounts estimated include: self-insurance accruals; retirement plan obligations; long-term incentive accruals; tax liabilities; loss contingencies; litigation claims; impairment assessments on long-lived assets (including goodwill); and that rely on projections of future cash flows and purchase price allocations.

The new strain of coronavirus (“COVID-19”) in 2020 and the efforts to contain it have negatively impacted the global economy, disrupted manufacturing operations and global supply chains and created significant volatility and disruption of financial markets. In addition, the COVID-19 pandemic has significantly increased economic and demand uncertainty. See Item 7 (“Management’s Discussion and Analysis of Results of Operations and Financial Condition”) of this Annual Report on Form 10-K for more information about the COVID-19 pandemic and its effects on our business, results of operations and financial condition. The Company believes the estimates and assumptions underlying our financial statements are reasonable and supportable based on the information available at the time the financial statements were prepared. However, uncertainty over the impact COVID-19 will have on the global economy and our business in particular makes many of the estimates and assumptions reflected in our 2020 consolidated financial statements inherently less certain. Therefore, actual results may ultimately differ from those estimates to a greater degree than historically.

v3.20.2
Description of Business Segments and Summary of Significant Accounting Policies (Tables)
 12 Months Ended
May 31, 2020
Accounting Policies [Abstract]  
Schedule of Depreciable Lives and Net Book Value of Property and Equipment

The depreciable lives and net book value of our property and equipment are as follows (dollars in millions):

 

 

 

 

 

Net Book Value at May 31,

 

 

 

Range

 

2020

 

 

2019

 

Wide-body aircraft and related equipment

 

15 to 30 years

 

$

13,448

 

 

$

11,975

 

Narrow-body and feeder aircraft and related equipment

 

5 to 18 years

 

 

2,478

 

 

 

2,696

 

Package handling and ground support equipment

 

3 to 30 years

 

 

4,499

 

 

 

4,157

 

Information technology

 

2 to 10 years

 

 

1,795

 

 

 

1,553

 

Vehicles and trailers

 

3 to 15 years

 

 

4,345

 

 

 

4,042

 

Facilities and other

 

2 to 40 years

 

 

7,043

 

 

 

6,006

 
v3.20.2
Goodwill and Other Intangible Assets (Tables)
 12 Months Ended
May 31, 2020
Goodwill And Other Intangible Assets Tables [Abstract]  
Schedule Of Goodwill The carrying amount of goodwill attributable to each reportable operating segment and changes therein are as follows (in millions):

 

 

 

FedEx Express

Segment

 

 

FedEx Ground

Segment

 

 

FedEx Freight

Segment

 

 

Corporate, Other and Eliminations

 

 

Total

 

Goodwill at May 31, 2018

 

$

5,100

 

 

$

840

 

 

$

767

 

 

$

1,950

 

 

$

8,657

 

Accumulated impairment charges

 

 

—

 

 

 

—

 

 

 

(133

)

 

 

(1,551

)

 

 

(1,684

)

Balance as of May 31, 2018

 

 

5,100

 

 

 

840

 

 

 

634

 

 

 

399

 

 

 

6,973

 

Goodwill acquired(1)

 

 

126

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

126

 

Other(2)

 

 

(210

)

 

 

—

 

 

 

—

 

 

 

(5

)

 

 

(215

)

Balance as of May 31, 2019

 

 

5,016

 

 

 

840

 

 

 

634

 

 

 

394

 

 

 

6,884

 

Impairment charges

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(358

)

 

 

(358

)

Other(2)

 

 

(147

)

 

 

—

 

 

 

—

 

 

 

(7

)

 

 

(154

)

Balance as of May 31, 2020

 

$

4,869

 

 

$

840

 

 

$

634

 

 

$

29

 

 

$

6,372

 

Accumulated goodwill impairment charges

   as of May 31, 2020

 

$

—

 

 

$

—

 

 

$

(133

)

 

$

(1,909

)

 

$

(2,042

)

 

(1)

Goodwill acquired relates to the acquisitions of Flying Cargo and the controlling interest in an existing joint venture with Swiss Post. See Note 3 for more information.

(2)

Primarily currency translation adjustments, purchase price allocation-related adjustments, and acquired goodwill related to immaterial acquisitions.

Schedule Of Identifiable Intangible Assets The summary of our intangible assets and related accumulated amortization at May 31, 2020 and 2019 is as follows (in millions):

 

 

 

2020

 

 

2019

 

 

 

Gross

Carrying

Amount

 

 

Accumulated

Amortization

 

 

Net Book

Value

 

 

Gross

Carrying

Amount

 

 

Accumulated

Amortization

 

 

Net Book

Value

 

Customer relationships

 

$

641

 

 

$

(327

)

 

$

314

 

 

$

685

 

 

$

(293

)

 

$

392

 

Technology

 

 

65

 

 

 

(57

)

 

 

8

 

 

 

66

 

 

 

(51

)

 

 

15

 

Trademarks and other

 

 

132

 

 

 

(132

)

 

 

—

 

 

 

137

 

 

 

(128

)

 

 

9

 

Total

 

$

838

 

 

$

(516

)

 

$

322

 

 

$

888

 

 

$

(472

)

 

$

416

 

 
Schedule of Finite Lived Intangible Assets Future Amortization Expense

Expected amortization expense for the next five years is as follows (in millions):

 

2021

$

49

 

2022

 

43

 

2023

 

40

 

2024

 

39

 

2025

 

38

 
v3.20.2
Selected Current Liabilities (Tables)
 12 Months Ended
May 31, 2020
Selected Current Liabilities Tables [Abstract]  
Components of Selected Current Liability Captions

The components of selected current liability captions at May 31 were as follows (in millions):

 

 

 

2020

 

 

2019

 

Accrued Salaries and Employee Benefits

 

 

 

 

 

 

 

 

Salaries

 

$

436

 

 

$

425

 

Employee benefits, including variable compensation

 

 

319

 

 

 

552

 

Compensated absences

 

 

814

 

 

 

764

 

 

 

$

1,569

 

 

$

1,741

 

Accrued Expenses

 

 

 

 

 

 

 

 

Self-insurance accruals

 

$

1,223

 

 

$

1,104

 

Taxes other than income taxes

 

 

417

 

 

 

304

 

Other

 

 

1,892

 

 

 

1,870

 

 

 

$

3,532

 

 

$

3,278

 
v3.20.2
Long Term Debt and Other Financing Arrangements (Tables)
 12 Months Ended
May 31, 2020
Long Term Debt Tables [Abstract]  
Components of Long-term Debt (Net of Discounts and Debt Issuance Costs)

The components of long-term debt (net of discounts and debt issuance costs), along with maturity dates for the years subsequent to May 31, 2020, are as follows (in millions):

 

 

 

 

 

 

 

 

 

May 31,

 

 

 

 

 

 

 

 

 

2020

 

 

2019

 

 

 

Interest Rate%

 

 

Maturity

 

 

 

 

 

 

 

 

Senior unsecured debt:

 

 

2.30

 

 

2020

 

$

—

 

 

$

400

 

 

 

 

3.40

 

 

2022

 

 

498

 

 

 

497

 

 

 

2.625-2.70

 

 

2023

 

 

748

 

 

 

747

 

 

 

 

4.00

 

 

2024

 

 

747

 

 

 

746

 

 

 

3.2-3.80

 

 

2025

 

 

1,687

 

 

 

696

 

 

 

 

3.25

 

 

2026

 

 

745

 

 

 

745

 

 

 

 

3.30

 

 

2027

 

 

446

 

 

 

446

 

 

 

 

3.40

 

 

2028

 

 

496

 

 

 

495

 

 

 

 

4.20

 

 

2029

 

 

397

 

 

 

396

 

 

 

3.1-4.25

 

 

2030

 

 

1,732

 

 

 

—

 

 

 

 

4.90

 

 

2034

 

 

495

 

 

 

495

 

 

 

 

3.90

 

 

2035

 

 

494

 

 

 

494

 

 

 

3.875-4.10

 

 

2043

 

 

984

 

 

 

984

 

 

 

 

5.10

 

 

2044

 

 

742

 

 

 

742

 

 

 

 

4.10

 

 

2045

 

 

641

 

 

 

641

 

 

 

4.55-4.75

 

 

2046

 

 

2,461

 

 

 

2,460

 

 

 

 

4.40

 

 

2047

 

 

735

 

 

 

735

 

 

 

 

4.05

 

 

2048

 

 

986

 

 

 

986

 

 

 

 

4.95

 

 

2049

 

 

835

 

 

 

835

 

 

 

 

5.25

 

 

2050

 

 

1,225

 

 

 

—

 

 

 

 

4.50

 

 

2065

 

 

246

 

 

 

246

 

 

 

 

7.60

 

 

2098

 

 

237

 

 

 

237

 

Euro senior unsecured debt:

 

 

0.50

 

 

2020

 

 

—

 

 

 

559

 

 

 

 

0.70

 

 

2022

 

 

695

 

 

 

713

 

 

 

 

1.00

 

 

2023

 

 

815

 

 

 

836

 

 

 

 

0.45

 

 

2026

 

 

541

 

 

 

—

 

 

 

 

1.625

 

 

2027

 

 

1,351

 

 

 

1,387

 

 

 

 

1.30

 

 

2032

 

 

539

 

 

 

—

 

Total senior unsecured debt

 

 

 

 

 

 

 

 

21,518

 

 

 

17,518

 

Other debt

 

 

 

 

 

 

 

 

—

 

 

 

1

 

Finance lease obligations

 

 

 

 

 

 

 

 

485

 

 

 

62

 

 

 

 

 

 

 

 

 

 

22,003

 

 

 

17,581

 

Less current portion

 

 

 

 

 

 

 

 

51

 

 

 

964

 

 

 

 

 

 

 

 

 

$

21,952

 

 

$

16,617

 
v3.20.2
Leases (Tables)
 12 Months Ended
May 31, 2020
Leases [Abstract]  
Summary of Components of Net Lease Cost

The following table is a summary of the components of net lease cost for the period ended May 31, 2020 (in millions):

 

 

 

2020

 

 

Operating lease cost(1)

 

$

2,668

 

 

Finance lease cost:

 

 

 

 

 

     Amortization of right-of-use assets

 

 

18

 

 

     Interest on lease liabilities

 

 

12

 

 

Total finance lease cost

 

 

30

 

 

Short-term lease cost

 

 

197

 

 

Variable lease cost(1)

 

 

1,160

 

 

Net lease cost

 

$

4,055

 

 

(1)   Expenses are primarily accounted for in the “Rentals and landing fees” line item. Additional amounts related to embedded leases are accounted for in the “Purchased transportation,” “Fuel” and “Other” line items in the accompanying consolidated statements of income.
Schedule of Supplemental Cash Flow Information Related to Leases

Supplemental cash flow information related to leases for the period ended May 31 is as follows (in millions):

 

 

 

2020

 

Cash paid for amounts included in the measurement of lease liabilities:

 

 

 

 

     Operating cash flows paid for operating leases

 

$

2,608

 

     Operating cash flows paid for interest portion of finance leases

 

 

14

 

     Financing cash flows paid for principal portion of finance leases

 

 

84

 

Right-of-use assets obtained in exchange for new operating lease liabilities

 

$

1,915

 

Right-of-use assets obtained in exchange for new finance lease liabilities

 

$

484

 
Schedule of Supplemental Balance Sheet Information Related to Leases

Supplemental balance sheet information related to leases as of May 31 is as follows (dollars in millions):

 

 

 

2020

 

Operating leases:

 

 

 

 

Operating lease right-of-use assets, net

 

$

13,917

 

 

 

 

 

 

Current portion of operating lease liabilities

 

 

1,923

 

Operating lease liabilities

 

 

12,195

 

    Total operating lease liabilities

 

$

14,118

 

 

 

 

 

 

Finance leases:

 

 

 

 

Net property and equipment

 

$

480

 

 

 

 

 

 

Current portion of long-term debt

 

 

51

 

Long-term debt, less current portion

 

 

434

 

    Total finance lease liabilities

 

$

485

 

 

 

 

 

 

Weighted-average remaining lease term

 

 

 

 

Operating leases

 

 

9.9

 

Finance leases

 

 

32.0

 

 

 

 

 

 

Weighted-average discount rate

 

 

 

 

Operating leases

 

 

3.19

%

Finance leases

 

 

3.58

%

 
Summary of Future Minimum Lease Payments, Operating and Finance Leases

A summary of future minimum lease payments under noncancelable operating and finance leases with an initial or remaining term in excess of one year at May 31, 2020 is as follows (in millions):

 

 

 

Aircraft

and Related

Equipment

 

 

Facilities

and Other

 

 

Total

Operating

Leases

 

 

Finance Leases

 

 

Total Leases

 

2021

 

$

250

 

 

$

2,099

 

 

$

2,349

 

 

$

67

 

 

$

2,416

 

2022

 

 

233

 

 

 

2,007

 

 

 

2,240

 

 

 

26

 

 

 

2,266

 

2023

 

 

198

 

 

 

1,789

 

 

 

1,987

 

 

 

25

 

 

 

2,012

 

2024

 

 

102

 

 

 

1,563

 

 

 

1,665

 

 

 

24

 

 

 

1,689

 

2025

 

 

69

 

 

 

1,365

 

 

 

1,434

 

 

 

81

 

 

 

1,515

 

Thereafter

 

 

245

 

 

 

6,661

 

 

 

6,906

 

 

 

646

 

 

 

7,552

 

Total lease payments

 

 

1,097

 

 

 

15,484

 

 

 

16,581

 

 

 

869

 

 

 

17,450

 

Less imputed interest

 

 

(92

)

 

 

(2,371

)

 

 

(2,463

)

 

 

(384

)

 

 

(2,847

)

Present value of lease liability

 

$

1,005

 

 

$

13,113

 

 

$

14,118

 

 

$

485

 

 

$

14,603

 
Schedule of Rent Expense Under Operating Leases

The following table is a summary of the Company’s net rental expense for operating leases for the years ended May 31, 2019 and 2018 (in millions):

 

 

 

2019

 

 

2018

 

Minimum rentals

 

$

2,875

 

 

$

2,913

 

Contingent rentals(1)

 

 

222

 

 

 

194

 

 

 

$

3,097

 

 

$

3,107

 

(1)

Contingent rentals are based on equipment usage.
Schedule of Future Minimum Lease Payments, Operating Leases

Future minimum lease payments under noncancelable operating leases with an initial or remaining term in excess of one year at May 31, 2019 were as follows (in millions):

 

 

 

Aircraft

and Related

Equipment

 

 

Facilities

and Other

 

 

Total

Operating

Leases

 

2020

 

$

288

 

 

$

2,209

 

 

$

2,497

 

2021

 

 

230

 

 

 

2,033

 

 

 

2,263

 

2022

 

 

212

 

 

 

1,816

 

 

 

2,028

 

2023

 

 

154

 

 

 

1,625

 

 

 

1,779

 

2024

 

 

58

 

 

 

1,428

 

 

 

1,486

 

Thereafter

 

 

85

 

 

 

7,977

 

 

 

8,062

 

Total

 

$

1,027

 

 

$

17,088

 

 

$

18,115

 

 
v3.20.2
Accumulated Other Comprehensive Income (Tables)
 12 Months Ended
May 31, 2020
Accumulated Other Comprehensive Income Loss Tables [Abstract]  
Schedule of Accumulated Other Comprehensive Income (Loss)

The following table provides changes in AOCI, net of tax, reported in the consolidated financial statements for the years ended May 31 (in millions; amounts in parentheses indicate debits to AOCI):

 

 

 

2020

 

 

2019

 

 

2018

 

Foreign currency translation loss:

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

$

(954

)

 

$

(759

)

 

$

(685

)

Translation adjustments

 

 

(254

)

 

 

(195

)

 

 

(74

)

Reclassification to retained earnings due to the adoption of ASU 2018-02

 

 

1

 

 

 

—

 

 

 

—

 

Balance at end of period

 

 

(1,207

)

 

 

(954

)

 

 

(759

)

Retirement plans adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

Balance at beginning of period

 

 

89

 

 

 

181

 

 

 

270

 

Prior service cost (credit) arising during period

 

 

3

 

 

 

—

 

 

 

(4

)

Reclassifications from AOCI

 

 

(82

)

 

 

(92

)

 

 

(85

)

Reclassification to retained earnings due to the adoption of ASU 2018-02

 

 

50

 

 

 

—

 

 

 

—

 

Balance at end of period

 

 

60

 

 

 

89

 

 

 

181

 

Accumulated other comprehensive loss at end of period

 

$

(1,147

)

 

$

(865

)

 

$

(578

)

 
Reclassification Out of Accumulated Other Comprehensive Income (Loss)

The following table presents details of the reclassifications from AOCI for the years ended May 31 (in millions; amounts in parentheses indicate debits to earnings):

 

 

 

Amount Reclassified from

AOCI

 

 

Affected Line Item in the

Income Statement

 

 

2020

 

 

2019

 

 

2018

 

 

 

Amortization of retirement plans prior service

   credits, before tax

 

$

107

 

 

$

120

 

 

$

121

 

 

Other retirement plans (expense) income

Income tax benefit

 

 

(25

)

 

 

(28

)

 

 

(36

)

 

Provision for income taxes

AOCI reclassifications, net of tax

 

$

82

 

 

$

92

 

 

$

85

 

 

Net income
v3.20.2
Stock-Based Compensation (Tables)
 12 Months Ended
May 31, 2020
Stock Based Compensation Tables [Abstract]  
Stock-based compensation expense

Our total stock-based compensation expense for the years ended May 31 was as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Stock-based compensation expense

 

$

168

 

 

$

174

 

 

$

167

 
Schedule of Stock Based Compensation Key Assumptions for Valuation The following table includes the weighted-average Black-Scholes value of our stock option grants, the intrinsic value of options exercised (in millions) and the key weighted-average assumptions used in the valuation calculations for options granted during the years ended May 31, followed by a discussion of our methodology for developing each of the assumptions used in the valuation model:

 

 

 

2020

 

 

2019

 

 

2018

 

Weighted-average Black-Scholes value

 

$

33.97

 

 

$

61.42

 

 

$

55.72

 

Intrinsic value of options exercised

 

$

44

 

 

$

122

 

 

$

359

 

Black-Scholes Assumptions:

 

 

 

 

 

 

 

 

 

 

 

 

Expected lives

 

6.4 years

 

 

6.4 years

 

 

6.5 years

 

Expected volatility

 

 

23

%

 

 

21

%

 

 

23

%

Risk-free interest rate

 

 

1.91

%

 

 

2.94

%

 

 

2.07

%

Dividend yield

 

 

1.630

%

 

 

0.935

%

 

 

0.796

%
Schedule of Stock Option Activity

The following table summarizes information regarding stock option activity for the year ended May 31, 2020:

 

 

 

Stock Options

 

 

 

Shares

 

 

Weighted-

Average

Exercise

Price

 

 

Weighted-

Average

Remaining

Contractual

Term

 

 

Aggregate

Intrinsic Value

(in millions)(1)

 

Outstanding at June 1, 2019

 

 

13,622,515

 

 

$

166.89

 

 

 

 

 

 

 

 

 

Granted

 

 

3,839,144

 

 

 

159.77

 

 

 

 

 

 

 

 

 

Exercised

 

 

(763,104

)

 

 

83.70

 

 

 

 

 

 

 

 

 

Forfeited

 

 

(573,810

)

 

 

192.34

 

 

 

 

 

 

 

 

 

Outstanding at May 31, 2020

 

 

16,124,745

 

 

$

167.79

 

 

 

6.2

 

 

$

118

 

Exercisable

 

 

9,654,040

 

 

$

154.19

 

 

 

4.7

 

 

$

118

 

Expected to vest

 

 

5,975,696

 

 

$

188.09

 

 

 

8.4

 

 

$

—

 

Available for future grants

 

 

27,415,296

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Only presented for options with market value at May 31, 2020 in excess of the exercise price of the option.

Schedule of Vested and Unvested Restricted Stock

The following table summarizes information regarding vested and unvested restricted stock for the year ended May 31, 2020:

 

 

 

Restricted Stock

 

 

 

Shares

 

 

Weighted-

Average

Grant Date

Fair Value

 

Unvested at June 1, 2019

 

 

324,478

 

 

$

217.76

 

Granted

 

 

207,012

 

 

 

158.58

 

Vested

 

 

(154,449

)

 

 

200.84

 

Forfeited

 

 

(5,351

)

 

 

197.07

 

Unvested at May 31, 2020

 

 

371,690

 

 

$

192.19

 
Schedule of Stock Option Vesting

Stock option vesting during the years ended May 31 was as follows:

 

 

 

Stock Options

 

 

 

Vested during

the year

 

 

Fair value

(in millions)

 

2020

 

 

2,073,310

 

 

$

99

 

2019

 

 

2,249,301

 

 

$

115

 

2018

 

 

2,465,493

 

 

$

112

 
v3.20.2
Computation of Earnings Per Share (Tables)
 12 Months Ended
May 31, 2020
Computation Of Earnings Per Share Tables [Abstract]  
Schedule of Basic and Diluted Earnings Per Common Share

The calculation of basic and diluted earnings per common share for the years ended May 31 was as follows (in millions, except per share amounts):

 

 

 

2020

 

 

2019

 

 

2018

 

Basic earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings allocable to common shares(1)

 

$

1,284

 

 

$

539

 

 

$

4,566

 

Weighted-average common shares

 

 

261

 

 

 

262

 

 

 

267

 

Basic earnings per common share

 

$

4.92

 

 

$

2.06

 

 

$

17.08

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share:

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings allocable to common shares(1)

 

$

1,284

 

 

$

539

 

 

$

4,566

 

Weighted-average common shares

 

 

261

 

 

 

262

 

 

 

267

 

Dilutive effect of share-based awards

 

 

1

 

 

 

3

 

 

 

5

 

Weighted-average diluted shares

 

 

262

 

 

 

265

 

 

 

272

 

Diluted earnings per common share

 

$

4.90

 

 

$

2.03

 

 

$

16.79

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Anti-dilutive options excluded from diluted earnings per common share

 

 

11.7

 

 

 

5.4

 

 

 

2.5

 

 

(1)

Net earnings available to participating securities were immaterial in all periods presented.

v3.20.2
Income Taxes (Tables)
 12 Months Ended
May 31, 2020
Income Tax Disclosure [Abstract]  
Schedule of Components of Provision for Income Taxes

The components of the provision for income taxes for the years ended May 31 were as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Current provision (benefit)

 

 

 

 

 

 

 

 

 

 

 

 

Domestic:

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

$

(230

)

 

$

(107

)

 

$

(540

)

State and local

 

 

67

 

 

 

64

 

 

 

43

 

Foreign

 

 

198

 

 

 

243

 

 

 

461

 

 

 

 

35

 

 

 

200

 

 

 

(36

)

Deferred provision (benefit)

 

 

 

 

 

 

 

 

 

 

 

 

Domestic:

 

 

 

 

 

 

 

 

 

 

 

 

Federal

 

 

475

 

 

 

(61

)

 

 

271

 

State and local

 

 

1

 

 

 

(7

)

 

 

125

 

Foreign

 

 

(128

)

 

 

(17

)

 

 

(579

)

 

 

 

348

 

 

 

(85

)

 

 

(183

)

 

 

$

383

 

 

$

115

 

 

$

(219

)

 
Schedule of Reconciliation of Total Income Tax Expense and Amount Computed by Statutory Federal Income Tax Rate to Income Before Taxes

A reconciliation of total income tax expense and the amount computed by applying the statutory federal income tax rate (21% in 2020, 21% in 2019 and 29.2% in 2018) to income before taxes for the years ended May 31 is as follows (in millions):

 

 

2020

 

 

2019

 

 

2018

 

Taxes computed at federal statutory rate

 

$

350

 

 

$

138

 

 

$

1,271

 

(Decreases) increases in income tax from:

 

 

 

 

 

 

 

 

 

 

 

 

Valuation allowance

 

 

(129

)

 

 

(79

)

 

 

31

 

Goodwill impairment charge

 

 

75

 

 

 

—

 

 

 

109

 

Benefit from U.S. tax loss carryback to prior years

 

 

(71

)

 

 

—

 

 

 

—

 

Non-deductible expenses

 

 

70

 

 

 

79

 

 

 

81

 

State and local income taxes, net of federal benefit

 

 

53

 

 

 

44

 

 

 

119

 

U.S. deferred tax adjustments related to foreign operations

 

 

51

 

 

 

—

 

 

 

—

 

Foreign operations

 

 

38

 

 

 

(1

)

 

 

25

 

Uncertain tax positions

 

 

(14

)

 

 

8

 

 

 

86

 

Foreign tax rate enactments

 

 

(10

)

 

 

50

 

 

 

6

 

Benefits from share-based payments

 

 

(5

)

 

 

(18

)

 

 

(60

)

TCJA(1)

 

 

—

 

 

 

(71

)

 

 

(1,354

)

Foreign tax credits from distributions

 

 

—

 

 

 

(8

)

 

 

(225

)

Corporate structuring transactions(2)

 

 

—

 

 

 

—

 

 

 

(255

)

Other, net

 

 

(25

)

 

 

(27

)

 

 

(53

)

Provision for income taxes (benefit)

 

$

383

 

 

$

115

 

 

$

(219

)

Effective Tax Rate

 

 

23.0

%

 

 

17.6

%

 

 

(5.0

)%

(1)

Primary components in 2018 were a $1.15 billion benefit from the remeasurement of our net U.S. deferred tax liability and a $204 million one-time benefit from a contribution to our U.S. Pension Plans in 2018.

(2)

The 2018 net benefit consists of foreign deferred tax benefits of $434 million, which were partially offset by U.S. deferred tax expenses of $179 million. 
Schedule of Significant Components of Deferred Tax Assets and Liabilities The significant components of deferred tax assets and liabilities as of May 31 were as follows (in millions):

 

 

 

2020

 

 

2019

 

 

 

Deferred Tax

Assets

 

 

Deferred Tax

Liabilities

 

 

Deferred Tax

Assets

 

 

Deferred Tax

Liabilities

 

Property, equipment, leases and intangibles(1)

 

$

3,819

 

 

$

8,745

 

 

$

592

 

 

$

4,633

 

Employee benefits

 

 

1,448

 

 

 

—

 

 

 

1,256

 

 

 

—

 

Self-insurance accruals

 

 

647

 

 

 

—

 

 

 

585

 

 

 

—

 

Other

 

 

579

 

 

 

375

 

 

 

510

 

 

 

340

 

Net operating loss/credit carryforwards

 

 

1,262

 

 

 

—

 

 

 

1,139

 

 

 

—

 

Valuation allowances

 

 

(450

)

 

 

—

 

 

 

(590

)

 

 

—

 

 

 

$

7,305

 

 

$

9,120

 

 

$

3,492

 

 

$

4,973

 

 

(1)

Includes impact from adoption of the new lease accounting standard in 2020. See Note 7 for additional information.
Schedule of Net Deferred Tax Liabilities

The net deferred tax liabilities as of May 31 have been classified in the balance sheets as follows (in millions):

 

 

 

2020

 

 

2019

 

Noncurrent deferred tax assets(1)

 

$

1,347

 

 

$

1,340

 

Noncurrent deferred tax liabilities

 

 

(3,162

)

 

 

(2,821

)

 

 

$

(1,815

)

 

$

(1,481

)

 

(1)

Noncurrent deferred tax assets are included in the line item “Other Assets” in our accompanying consolidated balance sheets.

Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Balance at beginning of year

 

$

164

 

 

$

161

 

 

$

67

 

Increases for tax positions taken in the current year

 

 

3

 

 

 

—

 

 

 

3

 

Increases for tax positions taken in prior years

 

 

4

 

 

 

31

 

 

 

103

 

Increase for business acquisition

 

 

—

 

 

 

—

 

 

 

—

 

Decreases for tax positions taken in prior years

 

 

(10

)

 

 

(4

)

 

 

(10

)

Settlements

 

 

(31

)

 

 

(21

)

 

 

(2

)

Decreases from lapse of statute of limitations

 

 

—

 

 

 

—

 

 

 

—

 

Changes due to currency translation

 

 

(1

)

 

 

(3

)

 

 

—

 

Balance at end of year

 

$

129

 

 

$

164

 

 

$

161

 

 
v3.20.2
Retirement Plans (Tables)
 12 Months Ended
May 31, 2020
Retirement Plan Tables [Abstract]  
Schedule of Retirement Plan Costs

A summary of our retirement plan costs over the past three years is as follows (in millions):

 

 

2020

 

 

2019

 

 

2018

 

Defined benefit pension plans

 

$

148

 

 

$

111

 

 

$

150

 

Defined contribution plans

 

 

574

 

 

 

561

 

 

 

527

 

Postretirement healthcare plans

 

 

85

 

 

 

75

 

 

 

74

 

Retirement plans MTM loss (gain)

 

 

794

 

 

 

3,882

 

 

 

(10

)

 

 

$

1,601

 

 

$

4,629

 

 

$

741

 

 

The components of the MTM adjustments are as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Discount rate change

 

$

2,997

 

 

$

1,780

 

 

$

(613

)

Demographic experience:

 

 

 

 

 

 

 

 

 

 

 

 

   Current year actuarial loss

 

 

50

 

 

 

739

 

 

 

419

 

   Change in future assumptions

 

 

(229

)

 

 

887

 

 

 

(37

)

Actual versus expected return on assets

 

 

(2,024

)

 

 

476

 

 

 

11

 

Annuity contract purchase

 

 

—

 

 

 

—

 

 

 

210

 

Total MTM loss (gain)

 

$

794

 

 

$

3,882

 

 

$

(10

)
Schedule of Weighted-Average Actuarial Assumptions Used to Determine the Benefit Obligations and Net Periodic Benefit Cost of Plans

Weighted-average actuarial assumptions used to determine the benefit obligations and net periodic benefit cost of our plans are as follows:

 

 

 

U.S. Pension Plans

 

 

International Pension Plans

 

 

Postretirement Healthcare Plans

 

 

 

2020

 

 

2019

 

 

2018

 

 

2020

 

 

2019

 

 

2018

 

 

2020

 

 

2019

 

 

2018

 

Discount rate used to determine benefit

   obligation

 

 

3.14

%

 

 

3.85

%

 

 

4.27

%

 

 

1.79

%

 

 

1.92

%

 

 

2.37

%

 

 

2.95

%

 

 

3.70

%

 

 

4.33

%

Discount rate used to determine net periodic

   benefit cost

 

 

3.85

 

 

 

4.27

 

 

 

4.08

 

 

 

1.92

 

 

 

2.34

 

 

 

2.43

 

 

 

3.70

 

 

 

4.33

 

 

 

4.32

 

Rate of increase in future compensation

   levels used to determine benefit obligation

 

 

5.17

 

 

 

5.10

 

 

 

4.43

 

 

 

2.19

 

 

 

2.27

 

 

 

2.26

 

 

 

—

 

 

 

—

 

 

 

—

 

Rate of increase in future compensation levels

   used to determine net periodic benefit cost

 

 

5.10

 

 

 

4.43

 

 

 

4.47

 

 

 

2.43

 

 

 

2.22

 

 

 

2.42

 

 

 

—

 

 

 

—

 

 

 

—

 

Expected long-term rate of return on assets

 

 

6.75

 

 

 

6.75

 

 

 

6.50

 

 

 

3.26

 

 

 

3.12

 

 

 

3.09

 

 

 

—

 

 

 

—

 

 

 

—

 

Interest crediting rate used to determine net

   periodic benefit cost

 

 

4.00

 

 

 

4.00

 

 

 

4.00

 

 

 

2.20

 

 

 

2.20

 

 

 

2.20

 

 

 

—

 

 

 

—

 

 

 

—

 

Interest crediting rate used to determine

   benefit obligation

 

 

4.00

 

 

 

4.00

 

 

 

4.00

 

 

 

2.00

 

 

 

2.20

 

 

 

2.20

 

 

 

—

 

 

 

—

 

 

 

—

 
Schedule of Plan Assets at Measurement Date

The fair values of investments by level and asset category and the weighted-average asset allocations for our U.S. Pension Plans and our most significant international pension plans at the measurement date are presented in the following table (in millions):

 

 

Plan Assets at Measurement Date

 

 

 

2020

 

Asset Class (U.S. Plans)

 

Fair Value

 

 

Actual %

 

 

Target

Range

%(1)

 

Quoted Prices in

Active Markets

Level 1

 

 

Other Observable

Inputs

Level 2

 

 

Unobservable

Inputs

Level 3

 

Cash and cash equivalents

 

$

709

 

 

 

3

%

 

0 - 5%

 

$

278

 

 

$

431

 

 

 

 

 

Equities

 

 

 

 

 

 

 

 

 

30 - 50

 

 

 

 

 

 

 

 

 

 

 

 

U.S. large cap equity(2)

 

 

3,070

 

 

 

11

 

 

 

 

 

1,172

 

 

 

 

 

 

 

 

 

International equities(2)

 

 

3,314

 

 

 

12

 

 

 

 

 

2,738

 

 

 

 

 

 

 

 

 

Global equities(2)

 

 

1,350

 

 

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. SMID cap equity

 

 

673

 

 

 

3

 

 

 

 

 

673

 

 

 

 

 

 

 

 

 

Fixed income securities

 

 

 

 

 

 

 

 

 

50 - 70

 

 

 

 

 

 

 

 

 

 

 

 

Corporate

 

 

7,983

 

 

 

30

 

 

 

 

 

 

 

 

 

7,983

 

 

 

 

 

Government(2)

 

 

6,928

 

 

 

26

 

 

 

 

 

 

 

 

 

4,652

 

 

 

 

 

Mortgage-backed and other(2)

 

 

634

 

 

 

2

 

 

 

 

 

 

 

 

 

170

 

 

 

 

 

Alternative investments(2)

 

 

2,264

 

 

 

8

 

 

0 - 15

 

 

 

 

 

 

 

 

 

$

416

 

Other

 

 

53

 

 

 

—

 

 

 

 

 

57

 

 

 

(3

)

 

 

 

 

Total U.S. plan assets

 

$

26,978

 

 

 

100

%

 

 

 

$

4,918

 

 

$

13,233

 

 

$

416

 

Asset Class (International Plans)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

9

 

 

 

1

%

 

 

 

$

9

 

 

 

 

 

 

 

 

 

Equities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

International equities(2)

 

 

72

 

 

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Global equities(2)

 

 

218

 

 

 

15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed income securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate(2)

 

 

342

 

 

 

23

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government(2)

 

 

510

 

 

 

34

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mortgage-backed and other(2)

 

 

188

 

 

 

12

 

 

 

 

 

318

 

 

 

 

 

 

 

 

 

Other(2)

 

 

158

 

 

 

10

 

 

 

 

 

13

 

 

$

63

 

 

 

 

 

Total international plan assets

 

$

1,497

 

 

 

100

%

 

 

 

$

340

 

 

$

63

 

 

 

 

 

(1)

Target ranges have not been provided for international plan assets as they are managed at an individual country level.

(2)

Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy but are included in the total.

 

 

 

Plan Assets at Measurement Date

 

 

 

2019

 

Asset Class (U.S. Plans)

 

Fair Value

 

 

Actual %

 

 

Target

Range

%(1)

 

Quoted Prices in

Active Markets

Level 1

 

 

Other Observable

Inputs

Level 2

 

 

Unobservable

Inputs

Level 3

 

Cash and cash equivalents

 

$

570

 

 

 

2

%

 

0 - 5%

 

$

50

 

 

$

520

 

 

 

 

 

Equities

 

 

 

 

 

 

 

 

 

30 - 50

 

 

 

 

 

 

 

 

 

 

 

 

U.S. large cap equity(2)

 

 

2,546

 

 

 

11

 

 

 

 

 

875

 

 

 

 

 

 

 

 

 

International equities(2)

 

 

3,306

 

 

 

14

 

 

 

 

 

2,700

 

 

 

 

 

 

 

 

 

Global equities(2)

 

 

1,451

 

 

 

6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. SMID cap equity

 

 

731

 

 

 

3

 

 

 

 

 

730

 

 

 

1

 

 

 

 

 

Fixed income securities

 

 

 

 

 

 

 

 

 

50 - 70

 

 

 

 

 

 

 

 

 

 

 

 

Corporate

 

 

6,794

 

 

 

29

 

 

 

 

 

 

 

 

 

6,794

 

 

 

 

 

Government(2)

 

 

5,384

 

 

 

23

 

 

 

 

 

 

 

 

 

3,742

 

 

 

 

 

Mortgage-backed and other(2)

 

 

622

 

 

 

3

 

 

 

 

 

 

 

 

 

175

 

 

 

 

 

Alternative investments(2)

 

 

1,963

 

 

 

9

 

 

0 - 15

 

 

 

 

 

 

 

 

 

$

302

 

Other

 

 

(47

)

 

 

—

 

 

 

 

 

(45

)

 

 

(2

)

 

 

 

 

Total U.S. plan assets

 

$

23,320

 

 

 

100

%

 

 

 

$

4,310

 

 

$

11,230

 

 

$

302

 

Asset Class (International Plans)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

57

 

 

 

4

%

 

 

 

$

57

 

 

 

 

 

 

 

 

 

Equities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

International equities(2)

 

 

72

 

 

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Global equities(2)

 

 

206

 

 

 

15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed income securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate(2)

 

 

322

 

 

 

24

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Government(2)

 

 

438

 

 

 

32

 

 

 

 

 

290

 

 

 

 

 

 

 

 

 

Mortgage-backed and other(2)

 

 

167

 

 

 

12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other(2)

 

 

112

 

 

 

8

 

 

 

 

 

10

 

 

$

17

 

 

 

 

 

Total international plan assets

 

$

1,374

 

 

 

100

%

 

 

 

$

357

 

 

$

17

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Target ranges have not been provided for international plan assets as they are managed at an individual country level.

(2)

Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy but are included in the total.
Schedule of Change in Fair Value of Level 3 Assets

The change in fair value of Level 3 assets that use significant unobservable inputs is shown in the table below (in millions):

 

 

U.S. Pension Plans

 

 

 

2020

 

 

2019

 

Balance at beginning of year

 

$

302

 

 

$

209

 

Actual return on plan assets:

 

 

 

 

 

 

 

 

Assets held during current year

 

 

19

 

 

 

11

 

Assets sold during the year

 

 

16

 

 

 

13

 

Purchases, sales and settlements

 

 

79

 

 

 

69

 

Balance at end of year

 

$

416

 

 

$

302

 

 
Schedule of Changes in the Pension and Postretirement Healthcare Plans' Benefit Obligation and Fair Value of Assets and Funded Status

The following tables provide a reconciliation of the changes in the pension and postretirement healthcare plans’ benefit obligations and fair value of assets over the two-year period ended May 31, 2020 and a statement of the funded status as of May 31, 2020 and 2019 (in millions):

 

 

 

U.S. Pension Plans

 

 

International

Pension Plans

 

 

Postretirement Healthcare Plans

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

Accumulated Benefit Obligation (“ABO”)

 

$

29,272

 

 

$

25,915

 

 

$

2,012

 

 

$

2,084

 

 

 

 

 

 

 

 

 

Changes in PBO and Accumulated Postretirement

   Benefit Obligation (“APBO”)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PBO/APBO at the beginning of year

 

$

26,554

 

 

$

22,653

 

 

$

2,301

 

 

$

2,167

 

 

$

1,221

 

 

$

955

 

Service cost

 

 

768

 

 

 

689

 

 

 

96

 

 

 

94

 

 

 

42

 

 

 

35

 

Interest cost

 

 

1,000

 

 

 

951

 

 

 

43

 

 

 

49

 

 

 

44

 

 

 

40

 

Actuarial loss (gain)

 

 

2,817

 

 

 

3,016

 

 

 

(87

)

 

 

127

 

 

 

85

 

 

 

266

 

Benefits paid

 

 

(940

)

 

 

(755

)

 

 

(41

)

 

 

(38

)

 

 

(127

)

 

 

(123

)

Settlements

 

 

—

 

 

 

—

 

 

 

(6

)

 

 

(13

)

 

 

—

 

 

 

—

 

Other

 

 

—

 

 

 

—

 

 

 

(64

)

 

 

(85

)

 

 

49

 

 

 

48

 

PBO/APBO at the end of year

 

$

30,199

 

 

$

26,554

 

 

$

2,242

 

 

$

2,301

 

 

$

1,314

 

 

$

1,221

 

Change in Plan Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fair value of plan assets at the beginning of year

 

$

23,320

 

 

$

22,057

 

 

$

1,578

 

 

$

1,509

 

 

$

—

 

 

$

—

 

Actual return on plan assets

 

 

3,530

 

 

 

984

 

 

 

146

 

 

 

94

 

 

 

—

 

 

 

—

 

Company contributions

 

 

1,068

 

 

 

1,034

 

 

 

86

 

 

 

91

 

 

 

77

 

 

 

73

 

Benefits paid

 

 

(940

)

 

 

(755

)

 

 

(41

)

 

 

(38

)

 

 

(127

)

 

 

(123

)

Settlements

 

 

—

 

 

 

—

 

 

 

(6

)

 

 

(13

)

 

 

—

 

 

 

—

 

Other

 

 

—

 

 

 

—

 

 

 

(50

)

 

 

(65

)

 

 

50

 

 

 

50

 

Fair value of plan assets at the end of year

 

$

26,978

 

 

$

23,320

 

 

$

1,713

 

 

$

1,578

 

 

$

—

 

 

$

—

 

Funded Status of the Plans

 

$

(3,221

)

 

$

(3,234

)

 

$

(529

)

 

$

(723

)

 

$

(1,314

)

 

$

(1,221

)

Amount Recognized in the Balance Sheet at May 31:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Noncurrent asset

 

$

—

 

 

$

—

 

 

$

142

 

 

$

82

 

 

$

—

 

 

$

—

 

Current pension, postretirement healthcare and

   other benefit obligations

 

 

(38

)

 

 

(70

)

 

 

(17

)

 

 

(16

)

 

 

(104

)

 

 

(87

)

Noncurrent pension, postretirement healthcare

   and other benefit obligations

 

 

(3,183

)

 

 

(3,164

)

 

 

(654

)

 

 

(789

)

 

 

(1,210

)

 

 

(1,134

)

Net amount recognized

 

$

(3,221

)

 

$

(3,234

)

 

$

(529

)

 

$

(723

)

 

$

(1,314

)

 

$

(1,221

)

Amounts Recognized in AOCI and not yet reflected

   in Net Periodic Benefit Cost:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Prior service (credit) cost and other

 

$

(68

)

 

$

(173

)

 

$

(7

)

 

$

(6

)

 

$

1

 

 

$

1

 

 
Schedule of Components of Pension Plans

Our pension plans included the following components at May 31 (in millions):

 

 

 

PBO

 

 

Fair Value of

Plan Assets

 

 

Funded Status

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

Qualified

 

$

30,004

 

 

$

26,978

 

 

$

(3,026

)

Nonqualified

 

 

195

 

 

 

—

 

 

 

(195

)

International Plans

 

 

2,242

 

 

 

1,713

 

 

 

(529

)

Total

 

$

32,441

 

 

$

28,691

 

 

$

(3,750

)

2019

 

 

 

 

 

 

 

 

 

 

 

 

Qualified

 

$

26,300

 

 

$

23,320

 

 

$

(2,980

)

Nonqualified

 

 

254

 

 

 

—

 

 

 

(254

)

International Plans

 

 

2,301

 

 

 

1,578

 

 

 

(723

)

Total

 

$

28,855

 

 

$

24,898

 

 

$

(3,957

)
Schedule of Fair Value of Plan Assets for Pension Plans with an Obligation in Excess of Plan Assets

 

The table above provides the PBO, fair value of plan assets and funded status of our pension plans on an aggregated basis. The following tables present our plans on a disaggregated basis to show those plans (as a group) whose assets did not exceed their liabilities. The fair value of plan assets for pension plans with a PBO or ABO in excess of plan assets at May 31 were as follows (in millions):

 

 

 

PBO Exceeds the Fair Value

of Plan Assets

 

 

 

2020

 

 

2019

 

U.S. Pension Benefits

 

 

 

 

 

 

 

 

Fair value of plan assets

 

$

26,978

 

 

$

23,320

 

PBO

 

 

(30,199

)

 

 

(26,554

)

Net funded status

 

$

(3,221

)

 

$

(3,234

)

International Pension Benefits

 

 

 

 

 

 

 

 

Fair value of plan assets

 

$

205

 

 

$

1,125

 

PBO

 

 

(876

)

 

 

(1,929

)

Net funded status

 

$

(671

)

 

$

(804

)

 

 

 

ABO Exceeds the Fair Value

of Plan Assets

 

 

 

2020

 

 

2019

 

U.S. Pension Benefits

 

 

 

 

 

 

 

 

ABO(1)

 

$

(29,272

)

 

$

(25,915

)

Fair value of plan assets

 

 

26,978

 

 

 

23,320

 

PBO

 

 

(30,199

)

 

 

(26,554

)

Net funded status

 

$

(3,221

)

 

$

(3,234

)

International Pension Benefits

 

 

 

 

 

 

 

 

ABO(1)

 

$

(637

)

 

$

(1,709

)

Fair value of plan assets

 

 

175

 

 

 

1,120

 

PBO

 

 

(840

)

 

 

(1,925

)

Net funded status

 

$

(665

)

 

$

(805

)

(1)

ABO not used in determination of funded status.

Schedule of Contributions to Pension Plans

Contributions to our U.S. Pension Plans for the years ended May 31 were as follows (in millions):

 

 

2020

 

 

2019

 

Required

 

$

—

 

 

$

—

 

Voluntary

 

 

1,000

 

 

 

1,000

 

 

 

$

1,000

 

 

$

1,000

 

 
Schedule of Net Periodic Benefit Cost

Net periodic benefit cost for the three years ended May 31 were as follows (in millions):

 

 

U.S. Pension Plans

 

 

International Pension Plans

 

 

Postretirement Healthcare Plans

 

 

 

2020

 

 

2019

 

 

2018

 

 

2020

 

 

2019

 

 

2018

 

 

2020

 

 

2019

 

 

2018

 

Service cost

 

$

768

 

 

$

689

 

 

$

679

 

 

$

96

 

 

$

94

 

 

$

97

 

 

$

42

 

 

$

35

 

 

$

36

 

Interest cost

 

 

1,000

 

 

 

951

 

 

 

1,115

 

 

 

43

 

 

 

49

 

 

 

49

 

 

 

44

 

 

 

40

 

 

 

39

 

Expected return on plan assets

 

 

(1,601

)

 

 

(1,505

)

 

 

(1,624

)

 

 

(52

)

 

 

(47

)

 

 

(46

)

 

 

—

 

 

 

—

 

 

 

—

 

Amortization of prior service credit

 

 

(105

)

 

 

(118

)

 

 

(118

)

 

 

(2

)

 

 

(2

)

 

 

(2

)

 

 

—

 

 

 

—

 

 

 

(1

)

Actuarial losses (gains) and other

 

 

888

 

 

 

3,537

 

 

 

37

 

 

 

(179

)

 

 

80

 

 

 

(38

)

 

 

85

 

 

 

265

 

 

 

(9

)

Net periodic benefit cost

 

$

950

 

 

$

3,554

 

 

$

89

 

 

$

(94

)

 

$

174

 

 

$

60

 

 

$

171

 

 

$

340

 

 

$

65

 

 
Schedule of Expected Future Benefit Payments

Benefit payments, which reflect expected future service, are expected to be paid as follows for the years ending May 31 (in millions):

 

 

 

U.S. Pension Plans

 

 

International

Pension Plans

 

 

Postretirement

Healthcare Plans

 

2021

 

$

1,008

 

 

$

50

 

 

$

104

 

2022

 

 

1,093

 

 

 

46

 

 

 

113

 

2023

 

 

1,154

 

 

 

51

 

 

 

121

 

2024

 

 

1,242

 

 

 

57

 

 

 

126

 

2025

 

 

1,331

 

 

 

62

 

 

 

120

 

2026-2030

 

 

7,967

 

 

 

414

 

 

 

433

 
v3.20.2
Business Segments and Disaggregated Revenue (Tables)
 12 Months Ended
May 31, 2020
Segment Reporting Disclosure Of Entitys Reportable Segments [Abstract]  
Schedule of Segment Information

The following table provides a reconciliation of reportable segment revenue, 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

 

 

Consolidated

Total

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

35,513

 

 

$

22,733

 

 

$

7,102

 

 

$

22

 

 

$

3,847

 

 

$

69,217

 

2019

 

 

37,331

 

 

 

20,522

 

 

 

7,582

 

 

 

22

 

 

 

4,236

 

 

 

69,693

 

2018

 

 

36,172

 

 

 

18,395

 

 

 

6,812

 

 

 

28

 

 

 

4,043

 

 

 

65,450

 

Depreciation and amortization

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

1,894

 

 

$

789

 

 

$

381

 

 

$

413

 

 

$

138

 

 

$

3,615

 

2019

 

 

1,801

 

 

 

728

 

 

 

332

 

 

 

355

 

 

 

137

 

 

 

3,353

 

2018

 

 

1,679

 

 

 

681

 

 

 

296

 

 

 

308

 

 

 

131

 

 

 

3,095

 

Operating income (loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020(1)

 

$

996

 

 

$

2,014

 

 

$

580

 

 

$

—

 

 

$

(1,173

)

 

$

2,417

 

2019(2)

 

 

2,176

 

 

 

2,663

 

 

 

615

 

 

 

—

 

 

 

(988

)

 

 

4,466

 

2018(3)

 

 

2,172

 

 

 

2,556

 

 

 

490

 

 

 

—

 

 

 

(946

)

 

 

4,272

 

Segment assets(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

41,252

 

 

$

24,700

 

 

$

6,434

 

 

$

7,285

 

 

$

(6,134

)

 

$

73,537

 

2019

 

 

33,247

 

 

 

17,561

 

 

 

4,736

 

 

 

6,061

 

 

 

(7,202

)

 

 

54,403

 

2018

 

 

31,753

 

 

 

15,458

 

 

 

4,251

 

 

 

5,501

 

 

 

(4,633

)

 

 

52,330

 

(1)

Includes TNT Express integration expenses of $270 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes noncash goodwill and other asset impairment charges of $435 million primarily related to goodwill impairment at FedEx Office and from the decision to permanently retire certain aircraft and related engines at FedEx Express.

(2)

Includes TNT Express integration expenses (including restructuring charges) of $388 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes business realignment costs of $320 million included in “Corporate, other and eliminations” and costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.

(3)

Includes TNT Express integration expenses (including restructuring charges) of $477 million. 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 included in “Corporate, other and eliminations.”

(4)

Segment assets include intercompany receivables.
Schedule of Segment Capital Expenditures

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

 

2020

 

$

3,560

 

 

 

$

1,083

 

 

$

539

 

 

$

527

 

 

$

159

 

 

$

5,868

 

2019

 

 

3,550

 

 

 

 

808

 

 

 

544

 

 

 

440

 

 

 

148

 

 

 

5,490

 

2018

 

 

3,461

 

 

 

 

1,178

 

 

 

490

 

 

 

411

 

 

 

123

 

 

 

5,663

 
Schedule of Revenue by Service Type and Geographical Information

 

The following table presents revenue by service type and geographic information for the years ended or as of May 31 (in millions):

 

 

2020

 

 

2019(1)

 

 

2018(1)

 

REVENUE BY SERVICE TYPE

 

 

 

 

 

 

 

 

 

 

 

 

FedEx Express segment:

 

 

 

 

 

 

 

 

 

 

 

 

Package:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. overnight box

 

$

7,234

 

 

$

7,663

 

 

$

7,273

 

U.S. overnight envelope

 

 

1,776

 

 

 

1,829

 

 

 

1,788

 

U.S. deferred

 

 

4,038

 

 

 

4,225

 

 

 

3,738

 

Total U.S. domestic package revenue

 

 

13,048

 

 

 

13,717

 

 

 

12,799

 

International priority

 

 

7,354

 

 

 

7,405

 

 

 

7,461

 

International economy

 

 

3,082

 

 

 

3,446

 

 

 

3,255

 

Total international export package revenue

 

 

10,436

 

 

 

10,851

 

 

 

10,716

 

International domestic(2)

 

 

4,179

 

 

 

4,540

 

 

 

4,637

 

Total package revenue

 

 

27,663

 

 

 

29,108

 

 

 

28,152

 

Freight:

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

 

2,998

 

 

 

3,025

 

 

 

2,797

 

International priority

 

 

1,915

 

 

 

2,070

 

 

 

2,105

 

International economy

 

 

1,930

 

 

 

2,123

 

 

 

1,916

 

International airfreight

 

 

270

 

 

 

314

 

 

 

368

 

Total freight revenue

 

 

7,113

 

 

 

7,532

 

 

 

7,186

 

Other(3)

 

 

737

 

 

 

691

 

 

 

834

 

Total FedEx Express segment

 

 

35,513

 

 

 

37,331

 

 

 

36,172

 

FedEx Ground segment

 

 

22,733

 

 

 

20,522

 

 

 

18,395

 

FedEx Freight segment

 

 

7,102

 

 

 

7,582

 

 

 

6,812

 

FedEx Services segment

 

 

22

 

 

 

22

 

 

 

28

 

Other and eliminations(4)

 

 

3,847

 

 

 

4,236

 

 

 

4,043

 

 

 

$

69,217

 

 

$

69,693

 

 

$

65,450

 

GEOGRAPHICAL INFORMATION(5)

 

 

 

 

 

 

 

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

$

48,404

 

 

$

47,584

 

 

$

43,581

 

International:

 

 

 

 

 

 

 

 

 

 

 

 

FedEx Express segment

 

 

19,177

 

 

 

20,424

 

 

 

20,417

 

FedEx Ground segment

 

 

479

 

 

 

467

 

 

 

407

 

FedEx Freight segment

 

 

192

 

 

 

207

 

 

 

181

 

FedEx Services segment

 

 

1

 

 

 

1

 

 

 

1

 

Other

 

 

964

 

 

 

1,010

 

 

 

863

 

Total international revenue

 

 

20,813

 

 

 

22,109

 

 

 

21,869

 

 

 

$

69,217

 

 

$

69,693

 

 

$

65,450

 

Noncurrent assets:

 

 

 

 

 

 

 

 

 

 

 

 

U.S.

 

$

45,691

 

 

$

33,189

 

 

$

30,362

 

International

 

 

11,463

 

 

 

8,128

 

 

 

8,627

 

 

 

$

57,154

 

 

$

41,317

 

 

$

38,989

 

(1)

Prior year amounts have been revised to conform to the current year presentation.

(2)

International domestic revenue relates to our intra-country operations.

(3)

Includes the operations of FedEx Custom Critical.

(4)

Includes the FedEx Office and FedEx Logistics operating segments.

(5)

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.

v3.20.2
Supplemental Cash Flow Information (Tables)
 12 Months Ended
May 31, 2020
Supplemental Cash Flow Tables [Abstract]  
Supplemental Cash Flow

Cash paid for interest expense and income taxes for the years ended May 31 was as follows (in millions):

 

 

 

2020

 

 

2019

 

 

2018

 

Cash payments for:

 

 

 

 

 

 

 

 

 

 

 

 

Interest (net of capitalized interest)

 

$

639

 

 

$

617

 

 

$

524

 

Income taxes

 

$

389

 

 

$

407

 

 

$

760

 

Income tax refunds received

 

 

(353

)

 

 

(36

)

 

 

(571

)

Cash tax payments, net

 

$

36

 

 

$

371

 

 

$

189

 
v3.20.2
Commitments (Tables)
 12 Months Ended
May 31, 2020
Commitments Tables [Abstract]  
Schedule of Purchase Commitments

Annual purchase commitments under various contracts as of May 31, 2020 were as follows (in millions):

 

 

 

Aircraft and

Aircraft Related

 

 

Other(1)

 

 

Total

 

2021

 

$

2,177

 

 

$

949

 

 

$

3,126

 

2022

 

 

2,772

 

 

 

590

 

 

 

3,362

 

2023

 

 

2,036

 

 

 

407

 

 

 

2,443

 

2024

 

 

697

 

 

 

263

 

 

 

960

 

2025

 

 

660

 

 

 

226

 

 

 

886

 

Thereafter

 

 

2,723

 

 

 

397

 

 

 

3,120

 

Total

 

$

11,065

 

 

$

2,832

 

 

$

13,897

 

(1)

Primarily equipment and advertising contracts.
Schedule of Aircraft Purchase Commitments The following table is a summary of the key aircraft we are committed to purchase as of May 31, 2020, with the year of expected delivery:

 

 

 

Cessna SkyCourier 408

 

 

ATR 72-600F

 

 

B767F

 

 

B777F

 

 

Total

 

2021

 

 

—

 

 

 

4

 

 

 

20

 

 

 

2

 

 

 

26

 

2022

 

 

9

 

 

 

7

 

 

 

18

 

 

 

5

 

 

 

39

 

2023

 

 

12

 

 

 

6

 

 

 

8

 

 

 

2

 

 

 

28

 

2024

 

 

12

 

 

 

6

 

 

 

—

 

 

 

4

 

 

 

22

 

2025

 

 

12

 

 

 

6

 

 

 

—

 

 

 

2

 

 

 

20

 

Thereafter

 

 

5

 

 

 

1

 

 

 

—

 

 

 

—

 

 

 

6

 

Total

 

 

50

 

 

 

30

 

 

 

46

 

 

 

15

 

 

 

141

 

 
v3.20.2
Summary of Quarterly Operating Results (Unaudited) (Tables)
 12 Months Ended
May 31, 2020
Quarterly Financial Information Disclosure [Abstract]  
Summary of Quarterly Operating Results (Unaudited)

 

(in millions, except per share amounts)

 

First

Quarter

 

 

Second

Quarter

 

 

Third

Quarter

 

 

Fourth

Quarter

 

2020(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

17,048

 

 

$

17,324

 

 

$

17,487

 

 

$

17,358

 

Operating income

 

 

977

 

 

 

554

 

 

 

411

 

 

 

475

 

Net income (loss)(2)

 

 

745

 

 

 

560

 

 

 

315

 

 

 

(334

)

Basic earnings (loss) per common share(3)

 

 

2.86

 

 

 

2.15

 

 

 

1.21

 

 

 

(1.28

)

Diluted earnings (loss) per common share(3)

 

 

2.84

 

 

 

2.13

 

 

 

1.20

 

 

 

(1.28

)

2019(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

17,052

 

 

$

17,824

 

 

$

17,010

 

 

$

17,807

 

Operating income

 

 

1,071

 

 

 

1,168

 

 

 

911

 

 

 

1,316

 

Net income (loss)(5)

 

 

835

 

 

 

935

 

 

 

739

 

 

 

(1,969

)

Basic earnings (loss) per common share(3)

 

 

3.15

 

 

 

3.56

 

 

 

2.83

 

 

 

(7.56

)

Diluted earnings (loss) per common share(3)

 

 

3.10

 

 

 

3.51

 

 

 

2.80

 

 

 

(7.56

)

(1)

The fourth quarter, third quarter, second quarter and first quarter of 2020 include $63 million, $72 million, $64 million and $71 million, respectively, of TNT Express integration expenses. The fourth quarter includes $369 million of goodwill and other asset impairment charges associated with the FedEx Office and FedEx Logistics operating segments and a net loss of $794 million related to the annual MTM retirement plans accounting adjustment. The second quarter of 2020 includes asset impairment charges of $66 million related to the permanent retirement of 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express.

(2)

The fourth quarter of 2020 includes a tax benefit of $71 million in connection with the 2020 U.S. tax loss that can be offset against income in prior years under the CARES Act and a tax expense of $51 million due to a change in deferred tax balances related to foreign tax operations. The second quarter of 2020 includes a tax benefit of $133 million from the reduction of a valuation allowance on certain foreign tax loss carryforwards.   

(3)

The sum of the quarterly earnings per share may not equal annual amounts due to differences in the weighted-average number of shares outstanding during the respective periods.

(4)

The fourth quarter, third quarter, second quarter and first quarter of 2019 include $84 million, $69 million, $114 million and $121 million, respectively, of TNT Express integration expenses (including any restructuring charges). The fourth quarter and third quarter of 2019 include business realignment costs of $316 million and $4 million, respectively. The fourth quarter includes a net loss of $3.9 billion related to the annual MTM retirement plans accounting adjustment. The second quarter of 2019 includes costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.

(5)

The third quarter of 2019 includes a tax benefit of $90 million from the reduction of a valuation allowance on certain tax loss carryforwards and a tax expense of $50 million related to a lower tax rate in the Netherlands applied to our deferred tax balances. The second quarter of 2019 includes a tax benefit of approximately $60 million from accelerated deductions claimed on our 2018 U.S. income tax return. In addition, we recognized a tax expense of $4 million in the second quarter of 2019 as a revision of the provisional benefit associated with the remeasurement of our net U.S. deferred tax liability upon completion of the accounting for the tax effects of the TCJA.
v3.20.2
Valuation and Qualifying Accounts (Tables)
 12 Months Ended
May 31, 2020
Valuation And Qualifying Accounts Tables Abstract  
Schedule of Valuation and Qualifying Accounts

SCHEDULE II

FEDEX CORPORATION

VALUATION AND QUALIFYING ACCOUNTS

FOR THE YEARS ENDED MAY 31, 2020, 2019 AND 2018

(IN MILLIONS)

 

 

 

 

 

 

 

ADDITIONS

 

 

 

 

 

 

 

 

 

DESCRIPTION

 

BALANCE

AT

BEGINNING

OF YEAR

 

 

CHARGED

TO

EXPENSES

 

 

CHARGED

TO

OTHER

ACCOUNTS

 

 

DEDUCTIONS

 

 

BALANCE

AT

END OF

YEAR

 

Accounts Receivable Reserves:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Doubtful Accounts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

121

 

 

$

442

 

 

$

—

 

 

$

388

 

(a)

 

175

 

2019

 

 

199

 

 

 

295

 

 

 

—

 

 

 

373

 

(a)

 

121

 

2018

 

 

115

 

 

 

246

 

 

 

—

 

 

 

162

 

(a)

 

199

 

Allowance for Revenue Adjustments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

179

 

 

$

—

 

 

$

1,286

 

(b)

$

1,250

 

(c)

$

215

 

2019

 

 

202

 

 

 

—

 

 

 

1,192

 

(b)

 

1,215

 

(c)

 

179

 

2018

 

 

137

 

 

 

—

 

 

 

1,173

 

(b)

 

1,108

 

(c)

 

202

 

Inventory Valuation Allowance:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2020

 

$

335

 

 

$

33

 

 

$

—

 

 

$

33

 

 

$

335

 

2019

 

 

268

 

 

 

28

 

 

 

75

 

 

 

36

 

 

 

335

 

2018

 

 

237

 

 

 

27

 

 

 

6

 

 

 

2

 

 

 

268

 

(a)

Uncollectible accounts written off, net of recoveries, and other adjustments.

(b)

Principally charged against revenue.

(c)

Service failures, rebills and other.

v3.20.2
Description of Business Segments and Summary of Significant Accounting Policies - Additional Information (Details)
$ / shares in Units, € in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
USD ($)
air-craft
$ / shares
shares
Feb. 29, 2020
$ / shares
 [1],[2]
Nov. 30, 2019
USD ($)
air-craft
$ / shares
Aug. 31, 2019
$ / shares
 [1],[2]
May 31, 2019
USD ($)
$ / shares
Feb. 28, 2019
USD ($)
$ / shares
Nov. 30, 2018
$ / shares
 [2],[3]
Aug. 31, 2018
$ / shares
 [2],[3]
May 31, 2020
USD ($)
air-craft
$ / shares
shares
May 31, 2019
USD ($)
Employee
$ / shares
shares
May 31, 2018
USD ($)
$ / shares
shares
May 31, 2020
EUR (€)
air-craft
shares
May 27, 2020
$ / shares
Jan. 26, 2016
shares
Organization Consolidation And Presentation Of Financial Statements [Line Items]                            
Gross contract assets related to in-transit shipments $ 563,000,000       $ 533,000,000       $ 563,000,000 $ 533,000,000        
Contract assets net of deferred unearned revenue 456,000,000       364,000,000       456,000,000 364,000,000        
Contract liabilities related to advance payments from customers $ 10,000,000       11,000,000       $ 10,000,000 11,000,000        
Payment terms of customer contracts                 Under the typical payment terms of our customer contracts, the customer pays at periodic intervals (e.g., every 15 days, 30 days, 45 days, etc.) for shipments included on invoices received. It is not customary business practice to extend payment terms past 90 days, and as such, we do not have a practice of including a significant financing component within our revenue contracts with customers.          
Advertising and promotion expenses                 $ 427,000,000 468,000,000 $ 442,000,000      
Depreciable life range for majority of aircraft costs                 15 to 30 years          
Depreciation expense, excluding gains and losses on sales of property and equipment                 $ 3,615,000,000 3,353,000,000 3,095,000,000      
Interest costs capitalized                 $ 54,000,000 64,000,000 61,000,000      
Number of aircraft to be permanently retired from service | air-craft     10                      
Number of aircraft engines to be permanently retired from service | air-craft     12                      
Noncash impairment charges     $ 66,000,000                      
Noncash impairment charges net of tax     $ 50,000,000                      
Noncash impairment charges net of tax per diluted share | $ / shares     $ 0.19                      
Number of aircraft temporarily idled | air-craft     7                      
Number of Idle Aircraft | air-craft 14               14     14    
Number of months aircraft remained idle                 an average of five months          
Gain on sale of TNT express business                   $ 8,000,000 $ 85,000,000      
Denominated debt as a net investment hedge | €                       € 392    
Stock repurchase program number of shares authorized to be repurchased | shares                           25,000,000
Number of shares repurchased | shares                 20,000.00 6,600,000 4,300,000      
Treasury stock acquired, average cost per share | $ / shares                 $ 156.90 $ 222.94 $ 237.45      
Payments for repurchase of common stock                 $ 3,000,000 $ 1,480,000,000 $ 1,017,000,000      
Stock repurchase program, remaining number of shares authorized to be repurchased | shares 5,100,000               5,100,000     5,100,000    
Dividends payable, date declared                 Jun. 15, 2020          
Dividends payable amount per share | $ / shares $ 0.65               $ 0.65       $ 0.65  
Dividends payable, date to be paid                 Jul. 13, 2020          
Dividends payable, date of record                 Jun. 29, 2020          
Number of employees left or voluntarily leaving | Employee                   1,500        
Business realignment costs         $ 316,000,000 $ 4,000,000       $ 320,000,000        
Diluted | $ / shares $ (1.28) [1],[2] $ 1.20 $ 2.13 [1],[2] $ 2.84 $ (7.56) [2],[3] $ 2.80 [2],[3] $ 3.51 $ 3.10 $ 4.90 $ 2.03 $ 16.79      
Business Realignment Activities [Member]                            
Organization Consolidation And Presentation Of Financial Statements [Line Items]                            
Business realignment costs paid at departure                 $ 50,000,000 $ 220,000,000        
Amended and Restated Five-Year Credit Agreement [Member]                            
Organization Consolidation And Presentation Of Financial Statements [Line Items]                            
Line Of Credit Facility Maximum Borrowing Capacity $ 2,000,000,000.0               2,000,000,000.0          
Amended and Restated 364-Day Credit Agreement [Member]                            
Organization Consolidation And Presentation Of Financial Statements [Line Items]                            
Line Of Credit Facility Maximum Borrowing Capacity $ 1,500,000,000               $ 1,500,000,000          
Line of Credit Facility, Term 364 days                          
Amendments to Credit Agreements [Member]                            
Organization Consolidation And Presentation Of Financial Statements [Line Items]                            
Dividends payable amount per share | $ / shares $ 0.65               $ 0.65          
Minimum [Member]                            
Organization Consolidation And Presentation Of Financial Statements [Line Items]                            
Intangible assets amortization periods                 3 years          
Maximum [Member]                            
Organization Consolidation And Presentation Of Financial Statements [Line Items]                            
Intangible assets amortization periods                 15 years          
FedEx Express Segment [Member]                            
Organization Consolidation And Presentation Of Financial Statements [Line Items]                            
Gain on sale of TNT express business                     $ 85,000,000      
[1] The fourth quarter, third quarter, second quarter and first quarter of 2020 include $63 million, $72 million, $64 million and $71 million, respectively, of TNT Express integration expenses. The fourth quarter includes $369 million of goodwill and other asset impairment charges associated with the FedEx Office and FedEx Logistics operating segments and a net loss of $794 million related to the annual MTM retirement plans accounting adjustment. The second quarter of 2020 includes asset impairment charges of $66 million related to the permanent retirement of 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express.
[2] The sum of the quarterly earnings per share may not equal annual amounts due to differences in the weighted-average number of shares outstanding during the respective periods.
[3] The fourth quarter, third quarter, second quarter and first quarter of 2019 include $84 million, $69 million, $114 million and $121 million, respectively, of TNT Express integration expenses (including any restructuring charges). The fourth quarter and third quarter of 2019 include business realignment costs of $316 million and $4 million, respectively. The fourth quarter includes a net loss of $3.9 billion related to the annual MTM retirement plans accounting adjustment. The second quarter of 2019 includes costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
v3.20.2
Description of Business Segments and Summary of Significant Accounting Policies - Schedule of Depreciable Lives and Net Book Value of Our Property and Equipment (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
Property Plant And Equipment [Line Items]    
Net Book Value at May 31, $ 33,608 $ 30,429
Wide-body Aircraft and Related Equipment [Member]    
Property Plant And Equipment [Line Items]    
Depreciable lives range 15 to 30 years  
Net Book Value at May 31, $ 13,448 11,975
Narrow-body and Feeder Aircraft and Related Equipment [Member]    
Property Plant And Equipment [Line Items]    
Depreciable lives range 5 to 18 years  
Net Book Value at May 31, $ 2,478 2,696
Package Handling and Ground Support Equipment [Member]    
Property Plant And Equipment [Line Items]    
Depreciable lives range 3 to 30 years  
Net Book Value at May 31, $ 4,499 4,157
Information Technology [Member]    
Property Plant And Equipment [Line Items]    
Depreciable lives range 2 to 10 years  
Net Book Value at May 31, $ 1,795 1,553
Vehicles And Trailers [Member]    
Property Plant And Equipment [Line Items]    
Depreciable lives range 3 to 15 years  
Net Book Value at May 31, $ 4,345 4,042
Facilities and Other Property [Member]    
Property Plant And Equipment [Line Items]    
Depreciable lives range 2 to 40 years  
Net Book Value at May 31, $ 7,043 $ 6,006
v3.20.2
Recent Accounting Guidance - Additional Information (Details) - USD ($)
$ in Millions
Jun. 01, 2019
May 31, 2020
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]    
Operating lease liability $ 14,200 $ 14,118
Operating right-of-use asset 14,100 $ 13,917
Cumulative effect on retained earnings, before tax 57  
Cumulative effect on retained earnings, net of tax 47  
Prepaid Asset [Member]    
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]    
Operating right-of-use asset 154  
Net Deferred Rent Liability [Member]    
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]    
Operating right-of-use asset $ 309  
v3.20.2
Business Combinations - Additional Information (Details)
£ in Millions, $ in Millions
May 01, 2019
USD ($)
Mar. 23, 2018
USD ($)
Mar. 23, 2018
GBP (£)
Oct. 13, 2017
USD ($)
P2P Mailing Limited [Member]        
Business Acquisition [Line Items]        
Acquisition price   $ 135 £ 92  
FC (Flying Cargo) Express Ltd. [Member]        
Business Acquisition [Line Items]        
Acquisition price $ 67      
Northwest Research, Inc. [Member]        
Business Acquisition [Line Items]        
Acquisition price       $ 50
v3.20.2
Goodwill and Other Intangible Assets - Schedule of Goodwill (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2020
May 31, 2018
Net Goodwill Detail [Abstract]        
Gross Goodwill at May 31       $ 8,657
Accumulated impairment charges     $ (2,042) (1,684)
Goodwill $ 6,884 $ 6,973 6,372 6,973
Goodwill Roll Forward        
Beginning Goodwill at May 31 6,884 6,973    
Goodwill acquired [1]   126    
Impairment charges (358)      
Other [2] (154) (215)    
Ending Goodwill at May 31 6,372 6,884    
Accumulated impairment charges     (2,042) (1,684)
Corporate, Other and Eliminations [Member]        
Net Goodwill Detail [Abstract]        
Gross Goodwill at May 31       1,950
Accumulated impairment charges     (1,909) (1,551)
Goodwill 29 394 29 399
Goodwill Roll Forward        
Beginning Goodwill at May 31 394 399    
Impairment charges (358) 0    
Other [2] (7) (5)    
Ending Goodwill at May 31 29 394    
Accumulated impairment charges     (1,909) (1,551)
FedEx Express Segment [Member] | Operating Segments [Member]        
Net Goodwill Detail [Abstract]        
Gross Goodwill at May 31       5,100
Goodwill 4,869 5,016 4,869 5,100
Goodwill Roll Forward        
Beginning Goodwill at May 31 5,016 5,100    
Goodwill acquired [1]   126    
Other [2] (147) (210)    
Ending Goodwill at May 31 4,869 5,016    
FedEx Ground Segment [Member] | Operating Segments [Member]        
Net Goodwill Detail [Abstract]        
Gross Goodwill at May 31       840
Goodwill 840 840 840 840
Goodwill Roll Forward        
Beginning Goodwill at May 31 840 840    
Ending Goodwill at May 31 840 840    
FedEx Freight Segment [Member] | Operating Segments [Member]        
Net Goodwill Detail [Abstract]        
Gross Goodwill at May 31       767
Accumulated impairment charges     (133) (133)
Goodwill 634 634 634 634
Goodwill Roll Forward        
Beginning Goodwill at May 31 634 634    
Ending Goodwill at May 31 $ 634 $ 634    
Accumulated impairment charges     $ (133) $ (133)
[1] Goodwill acquired relates to the acquisitions of Flying Cargo and the controlling interest in an existing joint venture with Swiss Post. See Note 3 for more information.
[2] Primarily currency translation adjustments, purchase price allocation-related adjustments, and acquired goodwill related to immaterial acquisitions.
v3.20.2
Goodwill and Other Intangible Assets - Additional Information (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
May 31, 2020
May 31, 2019
May 31, 2018
Goodwill [Line Items]        
Goodwill impairment charges   $ 358    
Intangible assets amortization expense   66 $ 82 $ 87
Corporate, Other and Eliminations [Member]        
Goodwill [Line Items]        
Goodwill impairment charges   358 $ 0  
Corporate, Other and Eliminations [Member] | Associated with FedEx Supply Chain [Member]        
Goodwill [Line Items]        
Goodwill impairment charges       $ 374
Corporate, Other and Eliminations [Member] | Associated with FedEx Office [Member]        
Goodwill [Line Items]        
Goodwill impairment charges   $ 348    
Corporate, Other and Eliminations [Member] | Associated with FedEx Office And Print Services [Member]        
Goodwill [Line Items]        
Goodwill impairment charges $ 358      
v3.20.2
Goodwill and Other Intangible Assets - Schedule Of Identifiable Intangible Assets (Details) - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
Finite Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 838 $ 888
Accumulated Amortization (516) (472)
Net Book Value 322 416
Customer Relationships [Member]    
Finite Lived Intangible Assets [Line Items]    
Gross Carrying Amount 641 685
Accumulated Amortization (327) (293)
Net Book Value 314 392
Technology [Member]    
Finite Lived Intangible Assets [Line Items]    
Gross Carrying Amount 65 66
Accumulated Amortization (57) (51)
Net Book Value 8 15
Trademarks and other [Member]    
Finite Lived Intangible Assets [Line Items]    
Gross Carrying Amount 132 137
Accumulated Amortization $ (132) (128)
Net Book Value   $ 9
v3.20.2
Goodwill and Other Intangible Assets - Schedule of Finite Lived Intangible Assets Future Amortization Expense (Details)
$ in Millions
May 31, 2020
USD ($)
Finite Lived Intangible Assets Future Amortization Expense Abstract  
2021 $ 49
2022 43
2023 40
2024 39
2025 $ 38
v3.20.2
Selected Current Liabilities - Components of Selected Current Liability Captions (Details) - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
Accrued Liabilities Current [Abstract]    
Salaries $ 436 $ 425
Employee benefits, including variable compensation 319 552
Compensated absences 814 764
Accrued salaries and employee benefits 1,569 1,741
Self-insurance accruals 1,223 1,104
Taxes other than income taxes 417 304
Other 1,892 1,870
Accrued expenses $ 3,532 $ 3,278
v3.20.2
Long-term Debt and Other Financing Arrangements - Components of Long-term Debt (Net of Discounts and Debt Issuance Costs) (Details) - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
Debt Instrument [Line Items]    
Long Term Debt $ 21,518 $ 17,518
Other debt   1
Finance lease obligations 485 62
Total Debt and Finance Lease Obligations 22,003 17,581
Less current portion 51 964
LONG-TERM DEBT, LESS CURRENT PORTION 21,952 16,617
Senior Unsecured Debt Due 2020 2.30% [Member]    
Debt Instrument [Line Items]    
Long Term Debt   400
Senior Unsecured Debt Due 2022 3.40% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 498 497
Senior Unsecured Debt Due 2023 2.625-2.70% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 748 747
Senior Unsecured Debt Due 2024 4.00% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 747 746
Senior Unsecured Debt Due 2025 3.2-3.80% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 1,687 696
Senior Unsecured Debt Due 2026 3.25% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 745 745
Senior Unsecured Debt Due 2027 3.30% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 446 446
Senior Unsecured Debt Due 2028 3.40% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 496 495
Senior Unsecured Debt Due 2029 4.20% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 397 396
Senior Unsecured Debt Due 2030 3.1-4.25% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 1,732  
Senior Unsecured Debt Due 2034 4.90% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 495 495
Senior Unsecured Debt Due 2035 3.90% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 494 494
Senior Unsecured Debt Due 2043 3.875-4.10% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 984 984
Senior Unsecured Debt Due 2044 5.10% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 742 742
Senior Unsecured Debt Due 2045 4.10% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 641 641
Senior Unsecured Debt Due 2046 4.55-4.75% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 2,461 2,460
Senior Unsecured Debt Due 2047 4.40% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 735 735
Senior Unsecured Debt Due 2048 4.05% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 986 986
Senior Unsecured Debt Due 2049 4.95% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 835 835
Senior Unsecured Debt Due 2050 5.25% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 1,225  
Senior Unsecured Debt Due 2065 4.50% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 246 246
Senior Unsecured Debt Due 2098 7.60% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 237 237
Euro Senior Unsecured Debt Due 2020 0.50% [Member]    
Debt Instrument [Line Items]    
Long Term Debt   559
Euro Senior Unsecured Debt Due 2022 0.70% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 695 713
Euro Senior Unsecured Debt Due 2023 1.00% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 815 836
Euro Senior Unsecured Debt Due 2026 0.45% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 541  
Euro Senior Unsecured Debt Due 2027 1.625% [Member]    
Debt Instrument [Line Items]    
Long Term Debt 1,351 $ 1,387
Euro Senior Unsecured Debt Due 2032 1.30% [Member]    
Debt Instrument [Line Items]    
Long Term Debt $ 539  
v3.20.2
Long-term Debt and Other Financing Arrangements - Additional Information (Details)
$ / shares in Units, € in Millions
 1 Months Ended
Mar. 18, 2020
USD ($)
Mar. 17, 2020
USD ($)
Apr. 30, 2020
USD ($)
Jul. 31, 2019
USD ($)
May 31, 2020
USD ($)
$ / shares
May 27, 2020
$ / shares
Jul. 31, 2019
EUR (€)
May 31, 2019
USD ($)
Line Of Credit Facility [Line Items]                
Long-term debt weighted-average interest rate         3.60%      
Long term debt, including current maturities and exclusive of finance leases fair value         $ 22,800,000,000     $ 17,800,000,000
Letter of credit maximum sublimit amount   $ 250,000,000            
Repayments of commercial paper     $ 136,000,000          
Financial Covenant Terms Ratio         350.00%      
Financial covenant compliance ratio, May 31, 2020           375.00%    
Financial covenant compliance ratio, August 31, 2020           475.00%    
Financial covenant compliance ratio, November 30, 2020           490.00%    
Financial covenant compliance ratio, February 28, 2021           475.00%    
Financial covenant compliance ratio, May 31, 2021           375.00%    
Financial covenant compliance ratio, August 31, 2021           350.00%    
Dividends payable amount per share | $ / shares         $ 0.65 $ 0.65    
Financial covenant compliance ratio         300.00%      
Letter of credit outstanding sublimit unused amount         $ 250,000,000      
Commercial paper outstanding         $ 0      
Payable at August 31, 2020 [Member]                
Line Of Credit Facility [Line Items]                
Dividends payable amount per share | $ / shares           0.65    
Payable at November 30, 2020 [Member]                
Line Of Credit Facility [Line Items]                
Dividends payable amount per share | $ / shares           0.65    
Payable at February 28, 2021 [Member]                
Line Of Credit Facility [Line Items]                
Dividends payable amount per share | $ / shares           0.65    
Payable at May 31, 2021 [Member]                
Line Of Credit Facility [Line Items]                
Dividends payable amount per share | $ / shares           $ 0.65    
Five-Year Credit Agreement [Member]                
Line Of Credit Facility [Line Items]                
Line of Credit Facility, Term   5 years            
Line Of Credit Facility Maximum Borrowing Capacity   $ 2,000,000,000.0            
Line of credit facility, expiration date   2025-03            
364-Day Credit Agreement [Member]                
Line Of Credit Facility [Line Items]                
Line of Credit Facility, Term   364 days 364 days          
Line Of Credit Facility Maximum Borrowing Capacity   $ 1,500,000,000            
Line of credit facility, expiration date   2021-03            
Proceeds from credit agreement $ 1,500,000,000              
Repayments of lines of credit     $ 1,500,000,000          
Senior Unsecured Debt [Member]                
Line Of Credit Facility [Line Items]                
Debt instrument, face amount     3,000,000,000.0 $ 2,100,000,000        
3.10% Fixed-rate Notes Due in August 2029 [Member]                
Line Of Credit Facility [Line Items]                
Debt instrument, face amount       $ 1,000,000,000.0        
Fixed interest rate       3.10%     3.10%  
Debt instrument, maturity date       2029-08        
0.45% Fixed-rate Notes Due in August 2025 [Member]                
Line Of Credit Facility [Line Items]                
Debt instrument, face amount | €             € 500  
Fixed interest rate       0.45%     0.45%  
Debt instrument, maturity date       2025-08        
1.30% Fixed-rate Notes Due in August 2031 [Member]                
Line Of Credit Facility [Line Items]                
Debt instrument, face amount | €             € 500  
Fixed interest rate       1.30%     1.30%  
Debt instrument, maturity date       2031-08        
2.30% Fixed-rate Notes Due in February 1 2020 [Member]                
Line Of Credit Facility [Line Items]                
Debt instrument, face amount       $ 400,000,000        
Fixed interest rate       2.30%     2.30%  
Debt instrument, maturity date       Feb. 01, 2020        
0.50% Notes Due April 09, 2020 [Member]                
Line Of Credit Facility [Line Items]                
Debt instrument, face amount | €             € 500  
Fixed interest rate       0.50%     0.50%  
Debt instrument, maturity date       Apr. 09, 2020        
3.80% Fixed-rate Notes Due in May 2025 [Member]                
Line Of Credit Facility [Line Items]                
Debt instrument, face amount     $ 1,000,000,000.0          
Fixed interest rate     3.80%          
Debt instrument, maturity date     2025-05          
4.25% Fixed-rate Notes Due in May 2030 [Member]                
Line Of Credit Facility [Line Items]                
Debt instrument, face amount     $ 750,000,000          
Fixed interest rate     4.25%          
Debt instrument, maturity date     2030-05          
5.25% Fixed-rate Notes Due in May 2050 [Member]                
Line Of Credit Facility [Line Items]                
Debt instrument, face amount     $ 1,250,000,000          
Fixed interest rate     5.25%          
Debt instrument, maturity date     2050-05          
v3.20.2
Leases - Summary of Components of Net Lease Cost (Details)
$ in Millions
 12 Months Ended
May 31, 2020
USD ($)
Leases [Abstract]  
Operating lease cost $ 2,668 [1]
Finance lease cost:  
Amortization of right-of-use assets 18
Interest on lease liabilities 12
Total finance lease cost 30
Short-term lease cost 197
Variable lease cost 1,160 [1]
Net lease cost $ 4,055
[1] Expenses are primarily accounted for in the “Rentals and landing fees” line item. Additional amounts related to embedded leases are accounted for in the “Purchased transportation,” “Fuel” and “Other” line items in the accompanying consolidated statements of income.
v3.20.2
Leases - Schedule of Supplemental Cash Flow Information Related to Leases (Details)
$ in Millions
 12 Months Ended
May 31, 2020
USD ($)
Leases [Abstract]  
Operating cash flows paid for operating leases $ 2,608
Operating cash flows paid for interest portion of finance leases 14
Financing cash flows paid for principal portion of finance leases 84
Right-of-use assets obtained in exchange for new operating lease liabilities 1,915
Right-of-use assets obtained in exchange for new finance lease liabilities $ 484
v3.20.2
Leases - Schedule of Supplemental Balance Sheet Information Related to Leases (Details) - USD ($)
$ in Millions
May 31, 2020
Jun. 01, 2019
May 31, 2019
Operating leases:      
Operating lease right-of-use assets, net $ 13,917 $ 14,100  
Current portion of operating lease liabilities 1,923    
Operating lease liabilities 12,195    
Total operating lease liabilities 14,118 $ 14,200  
Finance leases:      
Net property and equipment $ 480    
Finance Lease, Right of Use Asset, Statement of Financial Position [Extensible List] us-gaap:PropertyPlantAndEquipmentNet    
Current portion of long-term debt $ 51    
Finance Lease, Liability, Current Statement of Financial Position [Extensible List] us-gaap:LongTermDebtAndCapitalLeaseObligations    
Long-term debt, less current portion $ 434    
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] us-gaap:LongTermDebtAndCapitalLeaseObligations    
Total finance lease liabilities $ 485   $ 62
Weighted-average remaining lease term      
Operating leases 9 years 10 months 24 days    
Finance leases 32 years    
Weighted-average discount rate      
Operating leases 3.19%    
Finance leases 3.58%    
v3.20.2
Leases - Additional Information (Details) - USD ($)
$ in Billions
 12 Months Ended
May 31, 2020
May 31, 2019
Lessee Lease Description [Line Items]    
Finance and operating leases expiration term various dates through 2060  
Percentage total aircraft fleet leased 5.00% 6.00%
Additional leases not yet commenced, undiscounted future payments $ 1.6  
Minimum [Member]    
Lessee Lease Description [Line Items]    
Operating lease commencement date 2021  
Maximum [Member]    
Lessee Lease Description [Line Items]    
Operating lease commencement date 2022  
v3.20.2
Leases - Summary of Future Minimum Lease Payments, Operating and Finance Leases (Details) - USD ($)
$ in Millions
May 31, 2020
Jun. 01, 2019
May 31, 2019
Schedule Of Future Minimum Lease Payments For Operating Leases And Finance Leases [Line Items]      
2021 $ 2,416    
2022 2,266    
2023 2,012    
2024 1,689    
2025 1,515    
Thereafter 7,552    
Total lease payments 17,450    
Less imputed interest (2,847)    
Present value of lease liability 14,603    
Operating Leases      
2021 2,349    
2022 2,240    
2023 1,987    
2024 1,665    
2025 1,434    
Thereafter 6,906    
Total lease payments 16,581    
Less imputed interest (2,463)    
Present value of lease liability 14,118 $ 14,200  
Finance Leases      
2021 67    
2022 26    
2023 25    
2024 24    
2025 81    
Thereafter 646    
Total lease payments 869    
Less imputed interest (384)    
Present value of lease liability 485   $ 62
Aircraft and Related Equipment [Member]      
Operating Leases      
2021 250    
2022 233    
2023 198    
2024 102    
2025 69    
Thereafter 245    
Total lease payments 1,097    
Less imputed interest (92)    
Present value of lease liability 1,005    
Facilities and Other [Member]      
Operating Leases      
2021 2,099    
2022 2,007    
2023 1,789    
2024 1,563    
2025 1,365    
Thereafter 6,661    
Total lease payments 15,484    
Less imputed interest (2,371)    
Present value of lease liability $ 13,113    
v3.20.2
Leases - Schedule of Rent Expense Under Operating Leases (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2019
May 31, 2018
Operating Leases Rent Expense [Abstract]    
Minimum rentals $ 2,875 $ 2,913
Contingent rentals [1] 222 194
Operating leases rent expense, total $ 3,097 $ 3,107
[1] Contingent rentals are based on equipment usage.
v3.20.2
Leases - Schedule of Future Minimum Lease Payments, Operating Leases (Details)
$ in Millions
May 31, 2019
USD ($)
Schedule of Future Minimum Operating Lease Payments [Line Items]  
2020 $ 2,497
2021 2,263
2022 2,028
2023 1,779
2024 1,486
Thereafter 8,062
Total 18,115
Aircraft and Related Equipment [Member]  
Schedule of Future Minimum Operating Lease Payments [Line Items]  
2020 288
2021 230
2022 212
2023 154
2024 58
Thereafter 85
Total 1,027
Facilities and Other [Member]  
Schedule of Future Minimum Operating Lease Payments [Line Items]  
2020 2,209
2021 2,033
2022 1,816
2023 1,625
2024 1,428
Thereafter 7,977
Total $ 17,088
v3.20.2
Preferred Stock - Additional Information (Details)
May 31, 2020
$ / shares
shares
Preferred Stock Number Of Shares Par Value And Other Disclosures [Abstract]  
Preferred Stock Shares Authorized 4,000,000
Preferred Stock No Par Value | $ / shares
Preferred Stock Shares Issued 0
v3.20.2
Accumulated Other Comprehensive Income - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Accumulated Other Comprehensive Income Loss [Line Items]      
Beginning Balance $ 17,757 $ 19,416 $ 16,073
Translation adjustments (254) (195) (74)
Ending Balance 18,295 17,757 19,416
ASU 2018-02 [Member]      
Accumulated Other Comprehensive Income Loss [Line Items]      
Reclassification to retained earnings due to the adoption of ASU 2018-02 [1] 51    
Foreign Currency Translation Loss [Member]      
Accumulated Other Comprehensive Income Loss [Line Items]      
Beginning Balance (954) (759) (685)
Translation adjustments (254) (195) (74)
Ending Balance (1,207) (954) (759)
Foreign Currency Translation Loss [Member] | ASU 2018-02 [Member]      
Accumulated Other Comprehensive Income Loss [Line Items]      
Reclassification to retained earnings due to the adoption of ASU 2018-02 1    
Retirement Plans Adjustments [Member]      
Accumulated Other Comprehensive Income Loss [Line Items]      
Beginning Balance 89 181 270
Prior service cost (credit) arising during period 3   (4)
Reclassifications from AOCI (82) (92) (85)
Ending Balance 60 89 181
Retirement Plans Adjustments [Member] | ASU 2018-02 [Member]      
Accumulated Other Comprehensive Income Loss [Line Items]      
Reclassification to retained earnings due to the adoption of ASU 2018-02 50    
Accumulated Other Comprehensive Loss [Member]      
Accumulated Other Comprehensive Income Loss [Line Items]      
Beginning Balance (865) (578) (415)
Ending Balance (1,147) $ (865) $ (578)
Accumulated Other Comprehensive Loss [Member] | ASU 2018-02 [Member]      
Accumulated Other Comprehensive Income Loss [Line Items]      
Reclassification to retained earnings due to the adoption of ASU 2018-02 [1] $ 51    
[1] Relates to the adoption of ASU 2018-02.
v3.20.2
Accumulated Other Comprehensive Income - Reclassification Out of Accumulated Other Comprehensive Income (Loss) (Details) - Reclassification Out of Accumulated Other Comprehensive Income (Loss) [Member] - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]      
Other retirement plans (expense) income $ 107 $ 120 $ 121
Provision for income taxes (25) (28) (36)
Net income $ 82 $ 92 $ 85
v3.20.2
Stock-Based Compensation - Stock-based Compensation Expense (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Share Based Compensation Allocation And Classification In Financial Statements [Abstract]      
Stock-based compensation expense $ 168 $ 174 $ 167
v3.20.2
Stock-Based Compensation - Additional Information (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Share Based Compensation Arrangement Stock Options [Abstract]      
Stock option vesting period range one to four years    
Percentage of options vesting ratably over four years 82.00%    
Restricted stock expiration period ratably over a four-year period    
Stock-based compensation, key assumptions of valuation method Black-Scholes    
Maximum term of stock options 10 years    
Restricted stock granted 207,012 149,579 155,624
Restricted stock, weighted-average fair value $ 158.58 $ 253.28 $ 212.60
Employee Service Share Based Compensation Nonvested Awards Total Compensation Cost Not Yet Recognized Abstract      
Total unrecognized compensation cost, net of estimated forfeitures $ 209    
Stock option remaining weighted average vesting period 2 years    
Ratio Of Outstanding And Available To Grant Shares To Total Outstanding Common And Equity Compensation Shares And Equity Compensation Shares Available For Grant [Abstract]      
Ratio Of Outstanding And Available To Grant Shares To Total Outstanding Common And Equity Compensation Shares And Equity Compensation Shares Available For Grant 14.00%    
v3.20.2
Stock-Based Compensation - Schedule of Stock Based Compensation Key Assumptions for Valuation (Details) - USD ($)
$ / shares in Units, $ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Share Based Compensation Arrangement By Share Based Payment Award Fair Value Assumptions And Methodology [Abstract]      
Weighted-average Black-Scholes value $ 33.97 $ 61.42 $ 55.72
Intrinsic value of options exercised $ 44 $ 122 $ 359
Expected lives 6 years 4 months 24 days 6 years 4 months 24 days 6 years 6 months
Expected volatility 23.00% 21.00% 23.00%
Risk-free interest rate 1.91% 2.94% 2.07%
Dividend yield 1.63% 0.935% 0.796%
v3.20.2
Stock-Based Compensation - Schedule of Stock Option Activity (Details)
$ / shares in Units, $ in Millions
 12 Months Ended
May 31, 2020
USD ($)
$ / shares
shares
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Roll Forward  
Stock Options, Outstanding at June 1, 2019 13,622,515
Stock Options, Granted 3,839,144
Stock Options, Exercised (763,104)
Stock Options, Forfeited (573,810)
Stock Options, Outstanding at May 31, 2020 16,124,745
Stock Options, Exercisable 9,654,040
Stock Options, Expected to vest 5,975,696
Stock Options, Available for future grants 27,415,296
Share Based Compensation Arrangement By Share Based Payment Award Options Weighted Average Exercise Price [Abstract]  
Weighted-Average Exercise Price, Outstanding at June 1, 2019 | $ / shares $ 166.89
Weighted-Average Exercise Price, Granted | $ / shares 159.77
Weighted-Average Exercise Price, Exercised | $ / shares 83.70
Weighted-Average Exercise Price, Forfeited | $ / shares 192.34
Weighted-Average Exercise Price, Outstanding at May 31, 2020 | $ / shares 167.79
Weighted-Average Exercise Price, Exercisable | $ / shares 154.19
Weighted-Average Exercise Price, Expected to vest | $ / shares $ 188.09
Share Based Compensation Arrangement By Share Based Payment Award Options Outstanding Weighted Average Remaining Contractual Term (in years) [Abstract]  
Weighted-Average Remaining Contractual Term, Outstanding at May 31, 2020 6 years 2 months 12 days
Weighted-Average Remaining Contractual Term, Exercisable 4 years 8 months 12 days
Weighted-Average Remaining Contractual Term, Expected to vest 8 years 4 months 24 days
Share Based Compensation Arrangement By Share Based Payment Award Options Additional Disclosures Abstract  
Aggregate Intrinsic Value, Outstanding at May 31, 2020 | $ $ 118 [1]
Aggregate Intrinsic Value, Exercisable | $ $ 118 [1]
[1] Only presented for options with market value at May 31, 2020 in excess of the exercise price of the option.
v3.20.2
Stock-Based Compensation - Schedule of Vested and Unvested Restricted Stock (Details) - $ / shares
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options Nonvested Roll Forward      
Restricted Stock, Unvested at June 1, 2019 324,478    
Restricted Stock, Granted 207,012 149,579 155,624
Restricted Stock, Vested (154,449)    
Restricted Stock, Forfeited (5,351)    
Restricted Stock, Unvested at May 31, 2020 371,690 324,478  
Share Based Compensation Arrangement By Share Based Payment Award Equity Instruments Other Than Options Nonvested Weighted Average Grant Date Fair Value Roll Forward      
Weighted-Average Grant Date Fair Value, Unvested at June 1, 2019 $ 217.76    
Weighted-Average Grant Date Fair Value, Granted 158.58 $ 253.28 $ 212.60
Weighted-Average Grant Date Fair Value, Vested 200.84    
Weighted-Average Grant Date Fair Value, Forfeited 197.07    
Weighted-Average Grant Date Fair Value, Unvested at May 31, 2020 $ 192.19 $ 217.76  
v3.20.2
Stock-Based Compensation - Schedule of Stock Option Vesting (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Share Based Compensation Arrangement By Share Based Payment Award Options Additional Disclosures Abstract      
Vested during the year 2,073,310 2,249,301 2,465,493
Fair value $ 99 $ 115 $ 112
v3.20.2
Computation of Earnings Per Share - Schedule of Basic and Diluted Earnings per Common Share (Details) - USD ($)
$ / shares in Units, shares in Millions, $ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
 [2],[3]
Feb. 29, 2020
 [2],[3]
Nov. 30, 2019
 [2],[3]
Aug. 31, 2019
 [2],[3]
May 31, 2019
 [3],[4]
Feb. 28, 2019
 [3],[4]
Nov. 30, 2018
 [3],[4]
Aug. 31, 2018
 [3],[4]
May 31, 2020
May 31, 2019
May 31, 2018
Basic earnings per common share:                      
Net earnings allocable to common shares [1]                 $ 1,284 $ 539 $ 4,566
Weighted-average common shares                 261.0 262.0 267.0
Basic earnings (loss) per common share $ (1.28) $ 1.21 $ 2.15 $ 2.86 $ (7.56) $ 2.83 $ 3.56 $ 3.15 $ 4.92 $ 2.06 $ 17.08
Diluted earnings per common share:                      
Net earnings allocable to common shares [1]                 $ 1,284 $ 539 $ 4,566
Weighted-average common shares                 261.0 262.0 267.0
Dilutive effect of share-based awards                 1.0 3.0 5.0
Weighted-average diluted shares                 262.0 265.0 272.0
Diluted earnings (loss) per common share $ (1.28) $ 1.20 $ 2.13 $ 2.84 $ (7.56) $ 2.80 $ 3.51 $ 3.10 $ 4.90 $ 2.03 $ 16.79
Anti-dilutive options excluded from diluted earnings per common share                 11.7 5.4 2.5
[1] Net earnings available to participating securities were immaterial in all periods presented.
[2] The fourth quarter, third quarter, second quarter and first quarter of 2020 include $63 million, $72 million, $64 million and $71 million, respectively, of TNT Express integration expenses. The fourth quarter includes $369 million of goodwill and other asset impairment charges associated with the FedEx Office and FedEx Logistics operating segments and a net loss of $794 million related to the annual MTM retirement plans accounting adjustment. The second quarter of 2020 includes asset impairment charges of $66 million related to the permanent retirement of 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express.
[3] The sum of the quarterly earnings per share may not equal annual amounts due to differences in the weighted-average number of shares outstanding during the respective periods.
[4] The fourth quarter, third quarter, second quarter and first quarter of 2019 include $84 million, $69 million, $114 million and $121 million, respectively, of TNT Express integration expenses (including any restructuring charges). The fourth quarter and third quarter of 2019 include business realignment costs of $316 million and $4 million, respectively. The fourth quarter includes a net loss of $3.9 billion related to the annual MTM retirement plans accounting adjustment. The second quarter of 2019 includes costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
v3.20.2
Income Taxes - Schedule of Components of Provision for Income Taxes (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
May 31, 2020
May 31, 2019
May 31, 2018
Current provision (benefit)        
Federal   $ (230) $ (107) $ (540)
State and local   67 64 43
Foreign   198 243 461
Current Provision, Total   35 200 (36)
Deferred provision (benefit)        
Federal   475 (61) 271
State and local   1 (7) 125
Foreign   (128) (17) (579)
Deferred Provision, Total $ 51 348 (85) (183)
Provision for Income Taxes, Total   $ 383 $ 115 $ (219)
v3.20.2
Income Taxes - Additional Information (Details) - USD ($)
$ in Millions
 3 Months Ended 7 Months Ended 12 Months Ended
Mar. 27, 2020
May 31, 2020
Nov. 30, 2019
Feb. 28, 2019
Nov. 30, 2018
Dec. 31, 2017
May 31, 2020
May 31, 2019
May 31, 2018
Income Taxes [Line Items]                  
Earnings From Foreign Operations             $ 634 $ 929 $ 958
Statutory Federal Income Tax Rate           35.00% 21.00% 21.00% 29.20%
Benefit from reduction of valuation allowance on tax loss carryforwards     $ 133 $ 90     $ 133 $ 90  
Deferred income tax expense   $ 51         348 (85) $ (183)
Income tax benefit             (383) (115) 219
Income tax benefit related to lower statutory Income tax rate on earnings               40  
Income tax benefit from accelerated deductions to be claimed on 2018 tax return         $ (60)     75  
Provisional benefit related to remeasurement of net U.S. deferred tax liability                 (1,150)
Tax benefit from corporate structuring transactions [1]                 255
Tax benefits from foreign tax credits               8 225
Recognition of cumulative benefit from TCJA               233  
Provisional benefit related to remeasurement of net U.S. deferred tax liability, income tax expense amount recognized               4  
Unrecognized Tax Benefits That Would Impact Effective Tax Rate   127         127 141  
Unrecognized Tax Benefits Accrued Income Tax Penalties And Interest   41         41 38  
Foreign Country [Member]                  
Income Taxes [Line Items]                  
Operating Loss Carryforwards   3,600         3,600    
State And Local Jurisdiction [Member]                  
Income Taxes [Line Items]                  
Operating Loss Carryforwards   1,100         1,100    
U.S. Plans [Member]                  
Income Taxes [Line Items]                  
Additional provisional amount recognized one time benefit                 204
Defined benefit plan contributions by employer for one-time benefit                 $ 1,500
Netherlands [Member]                  
Income Taxes [Line Items]                  
Expense from the impact on deferred taxes attributable to a lower enacted tax rate               $ 50  
CARES Act [Member]                  
Income Taxes [Line Items]                  
Statutory Federal Income Tax Rate 35.00%                
Income tax loss carryback period 5 years                
Income tax benefit   $ 71         $ 71    
[1] The 2018 net benefit consists of foreign deferred tax benefits of $434 million, which were partially offset by U.S. deferred tax expenses of $179 million.
v3.20.2
Income Taxes - Schedule of Reconciliation of Total Income Tax Expense and Amount Computed by Statutory Federal Income Tax Rate to Income Before Taxes (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Income Tax Expense Benefit Continuing Operations Income Tax Reconciliation [Abstract]      
Taxes computed at federal statutory rate $ 350 $ 138 $ 1,271
Valuation allowance (129) (79) 31
Goodwill impairment charge 75   109
Benefit from U.S. tax loss carryback to prior years (71)    
Non-deductible expenses 70 79 81
State and local income taxes, net of federal benefit 53 44 119
U.S. deferred tax adjustments related to foreign operations 51    
Foreign operations 38 (1) 25
Uncertain tax positions (14) 8 86
Foreign tax rate enactments (10) 50 6
Benefits from share-based payments (5) (18) (60)
TCJA [1]   (71) (1,354)
Foreign tax credits from distributions   (8) (225)
Corporate structuring transactions [2]     (255)
Other, net (25) (27) (53)
Provision for Income Taxes, Total $ 383 $ 115 $ (219)
Effective Tax Rate 23.00% 17.60% (5.00%)
[1] Primary components in 2018 were a $1.15 billion benefit from the remeasurement of our net U.S. deferred tax liability and a $204 million one-time benefit from a contribution to our U.S. Pension Plans in 2018.
[2] The 2018 net benefit consists of foreign deferred tax benefits of $434 million, which were partially offset by U.S. deferred tax expenses of $179 million.
v3.20.2
Income Taxes - Schedule of Reconciliation of Total Income Tax Expense and Amount Computed by Statutory Federal Income Tax Rate to Income Before Taxes (Parenthetical) (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Income Taxes [Line Items]      
Provisional benefit related to remeasurement of net U.S. deferred tax liability     $ (1,150)
Foreign deferred tax benefits $ (128) $ (17) (579)
U.S. deferred tax expenses $ 475 $ (61) 271
Corporate Structuring Transactions [Member]      
Income Taxes [Line Items]      
Foreign deferred tax benefits     434
U.S. deferred tax expenses     179
U.S. Plans [Member]      
Income Taxes [Line Items]      
Additional provisional amount recognized one time benefit     $ 204
v3.20.2
Income Taxes - Schedule of Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
Components Of Deferred Tax Assets And Liabilities [Abstract]    
Property, equipment, leases and intangibles [1] $ 3,819 $ 592
Employee benefits 1,448 1,256
Self-insurance accruals 647 585
Other 579 510
Net operating loss/credit carryforwards 1,262 1,139
Valuation allowances (450) (590)
Deferred Tax Assets, Net 7,305 3,492
Property, equipment, leases and intangibles [1] 8,745 4,633
Other 375 340
Deferred Tax Liabilities $ 9,120 $ 4,973
[1] Includes impact from adoption of the new lease accounting standard in 2020. See Note 7 for additional information.
v3.20.2
Income Taxes - Schedule of Net Deferred Tax Liabilities (Details) - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
Deferred Tax Assets Liabilities Net [Abstract]    
Noncurrent deferred tax assets [1] $ 1,347 $ 1,340
Noncurrent deferred tax liabilities (3,162) (2,821)
Net deferred tax liabilities $ (1,815) $ (1,481)
[1] Noncurrent deferred tax assets are included in the line item “Other Assets” in our accompanying consolidated balance sheets.
v3.20.2
Income Taxes - Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Reconciliation Of Unrecognized Tax Benefits Excluding Amounts Pertaining To Examined Tax Returns Roll Forward      
Balance at beginning of year $ 164 $ 161 $ 67
Increases for tax positions taken in the current year 3   3
Increases for tax positions taken in prior years 4 31 103
Decreases for tax positions taken in prior years (10) (4) (10)
Settlements (31) (21) (2)
Changes due to currency translation (1) (3)  
Balance at end of year $ 129 $ 164 $ 161
v3.20.2
Retirement Plans - Schedule of Retirement Plan Costs (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2020
May 31, 2019
May 31, 2018
Pension And Other Postretirement Benefit Expense [Abstract]          
Defined benefit pension plans     $ 148 $ 111 $ 150
Defined contribution plans     574 561 527
Postretirement healthcare plans     85 75 74
Retirement plans MTM loss (gain) $ 794 $ 3,900 794 3,882 (10)
Retirement plans costs     $ 1,601 $ 4,629 $ 741
v3.20.2
Retirement Plans - Schedule of MTM Adjustments (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2020
May 31, 2019
May 31, 2018
Actuarial Gain Loss By Component Pre Tax [Abstract]          
Discount rate change     $ 2,997 $ 1,780 $ (613)
Demographic experience:          
Current year actuarial loss     50 739 419
Change in future assumptions     (229) 887 (37)
Actual versus expected return on assets     (2,024) 476 11
Annuity contract purchase         210
Total MTM loss (gain) $ 794 $ 3,900 $ 794 $ 3,882 $ (10)
v3.20.2
Retirement Plans - Additional Information (Details)
 1 Months Ended 12 Months Ended
May 31, 2018
USD ($)
RetireeandBeneficiary
May 31, 2021
USD ($)
May 31, 2020
USD ($)
May 31, 2019
USD ($)
May 31, 2018
USD ($)
May 31, 2017
Defined Benefit Plan Disclosure [Line Items]            
U.S. pension plan actual rate of return on assets     15.00% 4.05% 6.30%  
Weighted average discount rate percent all pension postretirement plans     3.05% 3.69% 4.11% 3.98%
401(k)-plan description     In November 2019, we announced the closing of our U.S.-based defined benefit pension plans to new non-union employees hired on or after January 1, 2020. We will introduce an all-401(k)-plan retirement benefit structure for eligible employees with a higher company match of up to 8% across all U.S.-based operating companies. During 2021, current eligible employees under the PPA pension formula will be given a one-time option to continue to be eligible for pension compensation credits under the existing PPA formula and remain in the existing 401(k) plan with its company match of up to 3.5%, or to cease receiving compensation credits under the PPA and move to the new 401(k) plan with the higher match of up to 8%. Changes to the new 401(k) plan structure become effective beginning January 1, 2022. While this new program will provide employees greater flexibility and reduce our long-term pension costs, it will not have a material impact on current or near-term financial results.      
Actual rate of return on plan assets for the 15-year period     7.70%      
Amounts recognized in other comprehensive income primarily related to amortization of prior service cost, net of tax     $ 79,000,000 $ 92,000,000 $ 89,000,000  
Defined benefit plan health care cost trend rate assumed for next fiscal year     5.70%      
Defined benefit plan ultimate health care cost trend rate     4.50%      
Defined benefit plan year that rate reaches ultimate trend rate     2037      
Metropolitan Life Insurance Company [Member]            
Defined Benefit Plan Disclosure [Line Items]            
One-time settlement loss $ 210,000,000          
U.S. Plans [Member]            
Defined Benefit Plan Disclosure [Line Items]            
Defined benefit plan contributions by employer     $ 1,000,000,000 $ 1,000,000,000    
Pension Plans [Member]            
Defined Benefit Plan Disclosure [Line Items]            
Expected long-term rate of return on assets     6.75% 6.75% 6.50%  
Pension Plans [Member] | U.S. Plans [Member]            
Defined Benefit Plan Disclosure [Line Items]            
Expected long-term rate of return on assets     6.75% 6.75% 6.50%  
Defined benefit plan contributions by employer     $ 1,068,000,000 $ 1,034,000,000    
Amounts recognized in other comprehensive income primarily related to amortization of prior service cost     105,000,000 118,000,000    
Amounts recognized in other comprehensive income primarily related to amortization of prior service cost, net of tax     $ 80,000,000 $ 91,000,000    
Pension Plans [Member] | U.S. Plans [Member] | Forecast            
Defined Benefit Plan Disclosure [Line Items]            
Defined benefit plan contributions by employer   $ 0        
Pension Plans [Member] | U.S. Plans [Member] | Metropolitan Life Insurance Company [Member]            
Defined Benefit Plan Disclosure [Line Items]            
Defined benefit plan responsibility transferred to number of retirees and beneficiaries | RetireeandBeneficiary 41,000          
Group annuity contract and transfer $ 6,000,000,000          
Future Plan Structure [Member] | Maximum [Member]            
Defined Benefit Plan Disclosure [Line Items]            
Company matching contributions to eligible employees     8.00%      
Current Plan Structure [Member] | Maximum [Member]            
Defined Benefit Plan Disclosure [Line Items]            
Company matching contributions to eligible employees     3.50%      
v3.20.2
Retirement Plans - Schedule of Weighted Average Actuarial Assumptions Used to Determine the Benefit Obligations and Net Periodic Benefit Cost of our Plans (Details)
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Pension Plans [Member]      
Defined Benefit Plan Assumptions Used In Calculations [Abstract]      
Expected long-term rate of return on assets 6.75% 6.75% 6.50%
Pension Plans [Member] | U.S. Plans [Member]      
Defined Benefit Plan Assumptions Used In Calculations [Abstract]      
Discount rate used to determine benefit obligation 3.14% 3.85% 4.27%
Discount rate used to determine net periodic benefit cost 3.85% 4.27% 4.08%
Rate of increase in future compensation levels used to determine benefit obligation 5.17% 5.10% 4.43%
Rate of increase in future compensation levels used to determine net periodic benefit cost 5.10% 4.43% 4.47%
Expected long-term rate of return on assets 6.75% 6.75% 6.50%
Interest crediting rate used to determine net periodic benefit cost 4.00% 4.00% 4.00%
Interest crediting rate used to determine benefit obligation 4.00% 4.00% 4.00%
Pension Plans [Member] | International Pension Plans [Member]      
Defined Benefit Plan Assumptions Used In Calculations [Abstract]      
Discount rate used to determine benefit obligation 1.79% 1.92% 2.37%
Discount rate used to determine net periodic benefit cost 1.92% 2.34% 2.43%
Rate of increase in future compensation levels used to determine benefit obligation 2.19% 2.27% 2.26%
Rate of increase in future compensation levels used to determine net periodic benefit cost 2.43% 2.22% 2.42%
Expected long-term rate of return on assets 3.26% 3.12% 3.09%
Interest crediting rate used to determine net periodic benefit cost 2.20% 2.20% 2.20%
Interest crediting rate used to determine benefit obligation 2.00% 2.20% 2.20%
Postretirement Healthcare Plans [Member]      
Defined Benefit Plan Assumptions Used In Calculations [Abstract]      
Discount rate used to determine benefit obligation 2.95% 3.70% 4.33%
Discount rate used to determine net periodic benefit cost 3.70% 4.33% 4.32%
v3.20.2
Retirement Plans - Schedule of Weighted-Average Asset Allocations for U.S Pension Plans and International Pension Plans (Details) - Pension Plans [Member] - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
May 31, 2018
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets $ 28,691 $ 24,898  
U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets $ 26,978 $ 23,320 $ 22,057
Actual % 100.00% 100.00%  
U.S. Plans [Member] | Cash And Cash Equivalents [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets $ 709 $ 570  
Actual % 3.00% 2.00%  
U.S. Plans [Member] | Cash And Cash Equivalents [Member] | Minimum [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Target % [1] 0.00% 0.00%  
U.S. Plans [Member] | Cash And Cash Equivalents [Member] | Maximum [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Target % [1] 5.00% 5.00%  
International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets $ 1,713 $ 1,578 1,509
Portion of Fair Value of Plan Assets $ 1,497 $ 1,374  
Actual % 100.00% 100.00%  
International Plans [Member] | Cash And Cash Equivalents [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets $ 9 $ 57  
Actual % 1.00% 4.00%  
U.S. Large Cap Equity [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] $ 3,070 $ 2,546  
Actual % [2] 11.00% 11.00%  
International Equity Securities [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] $ 3,314 $ 3,306  
Actual % [2] 12.00% 14.00%  
International Equity Securities [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2] $ 72 $ 72  
Actual % [2] 5.00% 5.00%  
Global Equity Funds [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] $ 1,350 $ 1,451  
Actual % [2] 5.00% 6.00%  
Global Equity Funds [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2] $ 218 $ 206  
Actual % [2] 15.00% 15.00%  
U.S. SMID Cap Equity [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets $ 673 $ 731  
Actual % 3.00% 3.00%  
Corporate Fixed Income Securities [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets $ 7,983 $ 6,794  
Actual % 30.00% 29.00%  
Corporate Fixed Income Securities [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2] $ 342 $ 322  
Actual % [2] 23.00% 24.00%  
Government Fixed Income Securities [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] $ 6,928 $ 5,384  
Actual % [2] 26.00% 23.00%  
Government Fixed Income Securities [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2] $ 510 $ 438  
Actual % [2] 34.00% 32.00%  
Mortgage Backed And Other Fixed Income Securities [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] $ 634 $ 622  
Actual % [2] 2.00% 3.00%  
Mortgage Backed And Other Fixed Income Securities [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2] $ 188 $ 167  
Actual % [2] 12.00% 12.00%  
Alternative investments [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] $ 2,264 $ 1,963  
Actual % [2] 8.00% 9.00%  
Alternative investments [Member] | U.S. Plans [Member] | Minimum [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Target % [1],[2] 0.00% 0.00%  
Alternative investments [Member] | U.S. Plans [Member] | Maximum [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Target % [1],[2] 15.00% 15.00%  
Other [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets $ 53    
Fair Value of Plan Liabilities   $ (47)  
Other [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2] $ 158 $ 112  
Actual % [2] 10.00% 8.00%  
Total Equities [Member] | U.S. Plans [Member] | Minimum [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Target % [1] 30.00% 30.00%  
Total Equities [Member] | U.S. Plans [Member] | Maximum [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Target % [1] 50.00% 50.00%  
Total Fixed Income Securities [Member] | U.S. Plans [Member] | Minimum [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Target % [1] 50.00% 50.00%  
Total Fixed Income Securities [Member] | U.S. Plans [Member] | Maximum [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Target % [1] 70.00% 70.00%  
Fair Value, Inputs, Level 1 | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets $ 4,918 $ 4,310  
Fair Value, Inputs, Level 1 | U.S. Plans [Member] | Cash And Cash Equivalents [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets 278 50  
Fair Value, Inputs, Level 1 | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets 340 357  
Fair Value, Inputs, Level 1 | International Plans [Member] | Cash And Cash Equivalents [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets 9 57  
Fair Value, Inputs, Level 1 | U.S. Large Cap Equity [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] 1,172 875  
Fair Value, Inputs, Level 1 | International Equity Securities [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] 2,738 2,700  
Fair Value, Inputs, Level 1 | U.S. SMID Cap Equity [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets 673 730  
Fair Value, Inputs, Level 1 | Government Fixed Income Securities [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2]   290  
Fair Value, Inputs, Level 1 | Mortgage Backed And Other Fixed Income Securities [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2] 318    
Fair Value, Inputs, Level 1 | Other [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets 57    
Fair Value of Plan Liabilities   (45)  
Fair Value, Inputs, Level 1 | Other [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2] 13 10  
Fair Value, Inputs, Level 2 | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets 13,233 11,230  
Fair Value, Inputs, Level 2 | U.S. Plans [Member] | Cash And Cash Equivalents [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets 431 520  
Fair Value, Inputs, Level 2 | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets 63 17  
Fair Value, Inputs, Level 2 | U.S. SMID Cap Equity [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets   1  
Fair Value, Inputs, Level 2 | Corporate Fixed Income Securities [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets 7,983 6,794  
Fair Value, Inputs, Level 2 | Government Fixed Income Securities [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] 4,652 3,742  
Fair Value, Inputs, Level 2 | Mortgage Backed And Other Fixed Income Securities [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] 170 175  
Fair Value, Inputs, Level 2 | Other [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Liabilities (3) (2)  
Fair Value, Inputs, Level 2 | Other [Member] | International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Portion of Fair Value of Plan Assets [2] 63 17  
Fair Value Inputs Level 3 [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets 416 302 $ 209
Fair Value Inputs Level 3 [Member] | Alternative investments [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Fair Value of Plan Assets [2] $ 416 $ 302  
[1] Target ranges have not been provided for international plan assets as they are managed at an individual country level.
[2] Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy but are included in the total.
v3.20.2
Retirement Plans - Schedule of Change in Fair Value of Level 3 Assets (Details) - Pension Plans [Member] - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
Defined Benefit Plan Disclosure [Line Items]    
Balance at beginning of year $ 24,898  
Actual return on plan assets:    
Balance at end of year 28,691 $ 24,898
U.S. Plans [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Balance at beginning of year 23,320 22,057
Actual return on plan assets:    
Balance at end of year 26,978 23,320
Fair Value Inputs Level 3 [Member] | U.S. Plans [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Balance at beginning of year 302 209
Actual return on plan assets:    
Assets held during current year 19 11
Assets sold during the year 16 13
Purchases, sales and settlements 79 69
Balance at end of year $ 416 $ 302
v3.20.2
Retirement Plans - Reconciliation of Changes In Pension And Postretirement Healthcare Plans Benefit Obligations And Fair Value Of Assets (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
U.S. Plans [Member]      
Changes in PBO and Accumulated Postretirement Benefit Obligation (“APBO”)      
Service cost $ 768    
Interest cost 1,000    
Change in Plan Assets      
Company contributions 1,000 $ 1,000  
Pension Plans [Member]      
Changes in PBO and Accumulated Postretirement Benefit Obligation (“APBO”)      
PBO/APBO at the beginning of year 28,855    
PBO/APBO at the end of year 32,441 28,855  
Change in Plan Assets      
Balance at beginning of year 24,898    
Balance at end of year 28,691 24,898  
Funded Status of the Plans (3,750) (3,957)  
Pension Plans [Member] | U.S. Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Accumulated Benefit Obligation (“ABO”) 29,272 25,915  
Changes in PBO and Accumulated Postretirement Benefit Obligation (“APBO”)      
PBO/APBO at the beginning of year 26,554 22,653  
Service cost 768 689 $ 679
Interest cost 1,000 951 1,115
Actuarial loss (gain) 2,817 3,016  
Benefits paid (940) (755)  
PBO/APBO at the end of year 30,199 26,554 22,653
Change in Plan Assets      
Balance at beginning of year 23,320 22,057  
Actual return on plan assets 3,530 984  
Company contributions 1,068 1,034  
Benefits paid (940) (755)  
Balance at end of year 26,978 23,320 22,057
Funded Status of the Plans (3,221) (3,234)  
Amount Recognized in the Balance Sheet at May 31:      
Current pension, postretirement healthcare and other benefit obligations (38) (70)  
Noncurrent pension, postretirement healthcare and other benefit obligations (3,183) (3,164)  
Net amount recognized (3,221) (3,234)  
Amounts Recognized in AOCI and not yet reflected in Net Periodic Benefit Cost:      
Prior service (credit) cost and other (68) (173)  
Pension Plans [Member] | International Pension Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Accumulated Benefit Obligation (“ABO”) 2,012 2,084  
Changes in PBO and Accumulated Postretirement Benefit Obligation (“APBO”)      
PBO/APBO at the beginning of year 2,301 2,167  
Service cost 96 94 97
Interest cost 43 49 49
Actuarial loss (gain) (87) 127  
Benefits paid (41) (38)  
Settlements (6) (13)  
Other (64) (85)  
PBO/APBO at the end of year 2,242 2,301 2,167
Change in Plan Assets      
Balance at beginning of year 1,578 1,509  
Actual return on plan assets 146 94  
Company contributions 86 91  
Benefits paid (41) (38)  
Settlements (6) (13)  
Other (50) (65)  
Balance at end of year 1,713 1,578 1,509
Funded Status of the Plans (529) (723)  
Amount Recognized in the Balance Sheet at May 31:      
Noncurrent asset 142 82  
Current pension, postretirement healthcare and other benefit obligations (17) (16)  
Noncurrent pension, postretirement healthcare and other benefit obligations (654) (789)  
Net amount recognized (529) (723)  
Amounts Recognized in AOCI and not yet reflected in Net Periodic Benefit Cost:      
Prior service (credit) cost and other (7) (6)  
Postretirement Healthcare Plans [Member]      
Changes in PBO and Accumulated Postretirement Benefit Obligation (“APBO”)      
PBO/APBO at the beginning of year 1,221 955  
Service cost 42 35 36
Interest cost 44 40 39
Actuarial loss (gain) 85 266  
Benefits paid (127) (123)  
Other 49 48  
PBO/APBO at the end of year 1,314 1,221 $ 955
Change in Plan Assets      
Company contributions 77 73  
Benefits paid (127) (123)  
Other 50 50  
Funded Status of the Plans (1,314) (1,221)  
Amount Recognized in the Balance Sheet at May 31:      
Current pension, postretirement healthcare and other benefit obligations (104) (87)  
Noncurrent pension, postretirement healthcare and other benefit obligations (1,210) (1,134)  
Net amount recognized (1,314) (1,221)  
Amounts Recognized in AOCI and not yet reflected in Net Periodic Benefit Cost:      
Prior service (credit) cost and other $ 1 $ 1  
v3.20.2
Retirement Plans - Schedule of Components of Pension Plans (Details) - Pension Plans [Member] - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
May 31, 2018
Defined Benefit Plan Disclosure [Line Items]      
Projected Benefit Obligation ("PBO") $ 32,441 $ 28,855  
Fair Value of Plan Assets 28,691 24,898  
Funded Status (3,750) (3,957)  
Qualified [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Projected Benefit Obligation ("PBO") 30,004 26,300  
Fair Value of Plan Assets 26,978 23,320  
Funded Status (3,026) (2,980)  
Nonqualified [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Projected Benefit Obligation ("PBO") 195 254  
Funded Status (195) (254)  
International Plans [Member]      
Defined Benefit Plan Disclosure [Line Items]      
Projected Benefit Obligation ("PBO") 2,242 2,301 $ 2,167
Fair Value of Plan Assets 1,713 1,578 $ 1,509
Funded Status $ (529) $ (723)  
v3.20.2
Retirement Plans - Schedule of Fair Value of Plan Assets for Pension Plans with a PBO or ABO in Excess of Plan Assets (Details) - Pension Plans [Member] - USD ($)
$ in Millions
May 31, 2020
May 31, 2019
U.S. Plans [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Fair value of plan assets $ 26,978 $ 23,320
PBO (30,199) (26,554)
Net funded status (3,221) (3,234)
ABO [1] (29,272) (25,915)
Fair value of plan assets 26,978 23,320
PBO (30,199) (26,554)
Net funded status (3,221) (3,234)
International Pension Plans [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Fair value of plan assets 205 1,125
PBO (876) (1,929)
Net funded status (671) (804)
ABO [1] (637) (1,709)
Fair value of plan assets 175 1,120
PBO (840) (1,925)
Net funded status $ (665) $ (805)
[1] ABO not used in determination of funded status.
v3.20.2
Retirement Plans - Schedule of Pension Plans Contributions (Details) - U.S. Plans [Member] - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
Defined Benefit Plan Disclosure [Line Items]    
Defined benefit plan contributions by employer $ 1,000 $ 1,000
Voluntary Contribution [Member]    
Defined Benefit Plan Disclosure [Line Items]    
Defined benefit plan contributions by employer $ 1,000 $ 1,000
v3.20.2
Retirement Plans - Schedule of Net Periodic Benefit Cost (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
U.S. Plans [Member]      
Net Periodic Benefit Cost      
Service cost $ 768    
Interest cost 1,000    
Expected return on plan assets (1,601)    
Amortization of prior service credit (105)    
Actuarial losses (gains) and other 888    
Net periodic benefit cost 950    
Pension Plans [Member] | U.S. Plans [Member]      
Net Periodic Benefit Cost      
Service cost 768 $ 689 $ 679
Interest cost 1,000 951 1,115
Expected return on plan assets   (1,505) (1,624)
Amortization of prior service credit   (118) (118)
Actuarial losses (gains) and other   3,537 37
Net periodic benefit cost   3,554 89
Pension Plans [Member] | International Pension Plans [Member]      
Net Periodic Benefit Cost      
Service cost 96 94 97
Interest cost 43 49 49
Expected return on plan assets (52) (47) (46)
Amortization of prior service credit (2) (2) (2)
Actuarial losses (gains) and other (179) 80 (38)
Net periodic benefit cost (94) 174 60
Postretirement Healthcare Plans [Member]      
Net Periodic Benefit Cost      
Service cost 42 35 36
Interest cost 44 40 39
Amortization of prior service credit     (1)
Actuarial losses (gains) and other 85 265 (9)
Net periodic benefit cost $ 171 $ 340 $ 65
v3.20.2
Retirement Plans - Schedule of Expected Future Benefit Payments (Details)
$ in Millions
May 31, 2020
USD ($)
Pension Plans [Member] | U.S. Plans [Member]  
Defined Benefit Plan Disclosure [Line Items]  
2021 $ 1,008
2022 1,093
2023 1,154
2024 1,242
2025 1,331
2026-2030 7,967
Pension Plans [Member] | International Pension Plans [Member]  
Defined Benefit Plan Disclosure [Line Items]  
2021 50
2022 46
2023 51
2024 57
2025 62
2026-2030 414
Postretirement Healthcare Plans [Member]  
Defined Benefit Plan Disclosure [Line Items]  
2021 104
2022 113
2023 121
2024 126
2025 120
2026-2030 $ 433
v3.20.2
Business Segments and Disaggregated Revenue - Schedule of Segment Information (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
Feb. 29, 2020
 [1]
Nov. 30, 2019
 [1]
Aug. 31, 2019
 [1]
May 31, 2019
Feb. 28, 2019
 [2]
Nov. 30, 2018
 [2]
Aug. 31, 2018
 [2]
May 31, 2020
May 31, 2019
May 31, 2018
Segment Reporting Information [Line Items]                      
Revenues $ 17,358 [1] $ 17,487 $ 17,324 $ 17,048 $ 17,807 [2] $ 17,010 $ 17,824 $ 17,052 $ 69,217 [3] $ 69,693 [3],[4] $ 65,450 [3],[4]
Depreciation and amortization                 3,615 3,353 3,095
Operating income (loss) 475 [1] $ 411 $ 554 $ 977 1,316 [2] $ 911 $ 1,168 $ 1,071 2,417 [5] 4,466 [6] 4,272 [7]
Segment assets [8] 73,537       54,403       73,537 54,403 52,330
Capital expenditures                 5,868 5,490 5,663
Operating Segments [Member] | FedEx Express Segment [Member]                      
Segment Reporting Information [Line Items]                      
Revenues                 35,513 37,331 [4] 36,172 [4]
Depreciation and amortization                 1,894 1,801 1,679
Operating income (loss)                 996 [5] 2,176 [6] 2,172 [7]
Segment assets [8] 41,252       33,247       41,252 33,247 31,753
Capital expenditures                 3,560 3,550 3,461
Operating Segments [Member] | FedEx Ground Segment [Member]                      
Segment Reporting Information [Line Items]                      
Revenues                 22,733 20,522 [4] 18,395 [4]
Depreciation and amortization                 789 728 681
Operating income (loss)                 2,014 [5] 2,663 [6] 2,556 [7]
Segment assets [8] 24,700       17,561       24,700 17,561 15,458
Capital expenditures                 1,083 808 1,178
Operating Segments [Member] | FedEx Freight Segment [Member]                      
Segment Reporting Information [Line Items]                      
Revenues                 7,102 7,582 [4] 6,812 [4]
Depreciation and amortization                 381 332 296
Operating income (loss)                 580 [5] 615 [6] 490 [7]
Segment assets [8] 6,434       4,736       6,434 4,736 4,251
Capital expenditures                 539 544 490
Operating Segments [Member] | FedEx Services Segment [Member]                      
Segment Reporting Information [Line Items]                      
Revenues                 22 22 [4] 28 [4]
Depreciation and amortization                 413 355 308
Segment assets [8] 7,285       6,061       7,285 6,061 5,501
Capital expenditures                 527 440 411
Corporate, Other and Eliminations [Member]                      
Segment Reporting Information [Line Items]                      
Revenues                 3,847 4,236 4,043
Depreciation and amortization                 138 137 131
Operating income (loss)                 (1,173) [5] (988) [6] (946) [7]
Segment assets [8] $ (6,134)       $ (7,202)       (6,134) (7,202) (4,633)
Capital expenditures                 $ 159 $ 148 $ 123
[1] The fourth quarter, third quarter, second quarter and first quarter of 2020 include $63 million, $72 million, $64 million and $71 million, respectively, of TNT Express integration expenses. The fourth quarter includes $369 million of goodwill and other asset impairment charges associated with the FedEx Office and FedEx Logistics operating segments and a net loss of $794 million related to the annual MTM retirement plans accounting adjustment. The second quarter of 2020 includes asset impairment charges of $66 million related to the permanent retirement of 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express.
[2] The fourth quarter, third quarter, second quarter and first quarter of 2019 include $84 million, $69 million, $114 million and $121 million, respectively, of TNT Express integration expenses (including any restructuring charges). The fourth quarter and third quarter of 2019 include business realignment costs of $316 million and $4 million, respectively. The fourth quarter includes a net loss of $3.9 billion related to the annual MTM retirement plans accounting adjustment. The second quarter of 2019 includes costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
[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.
[4] Prior year amounts have been revised to conform to the current year presentation.
[5] Includes TNT Express integration expenses of $270 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes noncash goodwill and other asset impairment charges of $435 million primarily related to goodwill impairment at FedEx Office and from the decision to permanently retire certain aircraft and related engines at FedEx Express.
[6] Includes TNT Express integration expenses (including restructuring charges) of $388 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes business realignment costs of $320 million included in “Corporate, other and eliminations” and costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
[7] Includes TNT Express integration expenses (including restructuring charges) of $477 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes goodwill and other asset impairment charges of $380 million included in “Corporate, other and eliminations.”
[8] Segment assets include intercompany receivables.
v3.20.2
Business Segments and Disaggregated Revenue - Schedule of Segment Information (Parenthetical) (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
Feb. 29, 2020
Nov. 30, 2019
Aug. 31, 2019
May 31, 2019
Feb. 28, 2019
Nov. 30, 2018
Aug. 31, 2018
May 31, 2020
May 31, 2019
May 31, 2018
Segment Reporting Information [Line Items]                      
Integration expenses $ 63 $ 72 $ 64 $ 71 $ 84 $ 69 $ 114 $ 121 $ 270 $ 388 $ 477
Goodwill and other asset impairment charges     $ 66           435   $ 380
Business realignment costs         $ 316 $ 4       320  
FedEx Office and FedEx Express [Member]                      
Segment Reporting Information [Line Items]                      
Goodwill and other asset impairment charges                 $ 435    
FedEx Ground Segment [Member]                      
Segment Reporting Information [Line Items]                      
Ground independent contractor legal expense             $ 46     $ 46  
v3.20.2
Business Segments and Disaggregated Revenue - Schedule of Revenue by Service Type (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
 [1]
Feb. 29, 2020
 [1]
Nov. 30, 2019
 [1]
Aug. 31, 2019
 [1]
May 31, 2019
 [2]
Feb. 28, 2019
 [2]
Nov. 30, 2018
 [2]
Aug. 31, 2018
 [2]
May 31, 2020
May 31, 2019
 [4]
May 31, 2018
 [4]
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues $ 17,358 $ 17,487 $ 17,324 $ 17,048 $ 17,807 $ 17,010 $ 17,824 $ 17,052 $ 69,217 [3] $ 69,693 [3] $ 65,450 [3]
Operating Segments [Member] | FedEx Express Segment [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 35,513 37,331 36,172
Operating Segments [Member] | FedEx Express Segment [Member] | U.S. overnight box [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 7,234 7,663 7,273
Operating Segments [Member] | FedEx Express Segment [Member] | U.S. overnight envelope [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 1,776 1,829 1,788
Operating Segments [Member] | FedEx Express Segment [Member] | U.S. deferred [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 4,038 4,225 3,738
Operating Segments [Member] | FedEx Express Segment [Member] | Total U.S. domestic package revenue [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 13,048 13,717 12,799
Operating Segments [Member] | FedEx Express Segment [Member] | International priority [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 7,354 7,405 7,461
Operating Segments [Member] | FedEx Express Segment [Member] | International economy [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 3,082 3,446 3,255
Operating Segments [Member] | FedEx Express Segment [Member] | Total international export package revenue [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 10,436 10,851 10,716
Operating Segments [Member] | FedEx Express Segment [Member] | International domestic [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues [5]                 4,179 4,540 4,637
Operating Segments [Member] | FedEx Express Segment [Member] | Total package revenue [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 27,663 29,108 28,152
Operating Segments [Member] | FedEx Express Segment [Member] | U.S. freight [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 2,998 3,025 2,797
Operating Segments [Member] | FedEx Express Segment [Member] | International priority freight [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 1,915 2,070 2,105
Operating Segments [Member] | FedEx Express Segment [Member] | International Economy Freight                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 1,930 2,123 1,916
Operating Segments [Member] | FedEx Express Segment [Member] | International Airfreight [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 270 314 368
Operating Segments [Member] | FedEx Express Segment [Member] | Total freight revenue [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 7,113 7,532 7,186
Operating Segments [Member] | FedEx Express Segment [Member] | Other [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues [6]                 737 691 834
Operating Segments [Member] | FedEx Ground Segment [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 22,733 20,522 18,395
Operating Segments [Member] | FedEx Freight Segment [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 7,102 7,582 6,812
Operating Segments [Member] | FedEx Services Segment [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues                 22 22 28
Corporate, Other and Eliminations [Member]                      
Entity Wide Information Revenue From External Customer [Line Items]                      
Revenues [7]                 $ 3,847 $ 4,236 $ 4,043
[1] The fourth quarter, third quarter, second quarter and first quarter of 2020 include $63 million, $72 million, $64 million and $71 million, respectively, of TNT Express integration expenses. The fourth quarter includes $369 million of goodwill and other asset impairment charges associated with the FedEx Office and FedEx Logistics operating segments and a net loss of $794 million related to the annual MTM retirement plans accounting adjustment. The second quarter of 2020 includes asset impairment charges of $66 million related to the permanent retirement of 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express.
[2] The fourth quarter, third quarter, second quarter and first quarter of 2019 include $84 million, $69 million, $114 million and $121 million, respectively, of TNT Express integration expenses (including any restructuring charges). The fourth quarter and third quarter of 2019 include business realignment costs of $316 million and $4 million, respectively. The fourth quarter includes a net loss of $3.9 billion related to the annual MTM retirement plans accounting adjustment. The second quarter of 2019 includes costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
[3] International revenue includes shipments that either originate in or are destined to locations outside the United States, which could include U.S. payors. Noncurrent assets include property and equipment, goodwill and other long-term assets. Our flight equipment is registered in the U.S. and is included as U.S. assets; however, many of our aircraft operate internationally.
[4] Prior year amounts have been revised to conform to the current year presentation.
[5] International domestic revenue relates to our intra-country operations.
[6] Includes the operations of FedEx Custom Critical.
[7] Includes the FedEx Office and FedEx Logistics operating segments.
v3.20.2
Business Segments and Disaggregated Revenue - Schedule of Geographical Information (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
Feb. 29, 2020
 [1]
Nov. 30, 2019
 [1]
Aug. 31, 2019
 [1]
May 31, 2019
Feb. 28, 2019
 [2]
Nov. 30, 2018
 [2]
Aug. 31, 2018
 [2]
May 31, 2020
May 31, 2019
 [4]
May 31, 2018
 [4]
Revenues From External Customers And Long Lived Assets [Line Items]                      
Revenues $ 17,358 [1] $ 17,487 $ 17,324 $ 17,048 $ 17,807 [2] $ 17,010 $ 17,824 $ 17,052 $ 69,217 [3] $ 69,693 [3] $ 65,450 [3]
Assets Noncurrent [3] 57,154       41,317 [4]       57,154 41,317 38,989
U.S. [Member]                      
Revenues From External Customers And Long Lived Assets [Line Items]                      
Revenues [3]                 48,404 47,584 43,581
Assets Noncurrent [3] 45,691       33,189 [4]       45,691 33,189 30,362
International [Member]                      
Revenues From External Customers And Long Lived Assets [Line Items]                      
Revenues [3]                 20,813 22,109 21,869
Assets Noncurrent [3] $ 11,463       $ 8,128 [4]       11,463 8,128 8,627
FedEx Express Segment [Member] | International [Member]                      
Revenues From External Customers And Long Lived Assets [Line Items]                      
Revenues [3]                 19,177 20,424 20,417
FedEx Ground Segment [Member] | International [Member]                      
Revenues From External Customers And Long Lived Assets [Line Items]                      
Revenues [3]                 479 467 407
FedEx Freight Segment [Member] | International [Member]                      
Revenues From External Customers And Long Lived Assets [Line Items]                      
Revenues [3]                 192 207 181
FedEx Services Segment [Member] | International [Member]                      
Revenues From External Customers And Long Lived Assets [Line Items]                      
Revenues [3]                 1 1 1
Other international revenue [Member] | International [Member]                      
Revenues From External Customers And Long Lived Assets [Line Items]                      
Revenues [3]                 $ 964 $ 1,010 $ 863
[1] The fourth quarter, third quarter, second quarter and first quarter of 2020 include $63 million, $72 million, $64 million and $71 million, respectively, of TNT Express integration expenses. The fourth quarter includes $369 million of goodwill and other asset impairment charges associated with the FedEx Office and FedEx Logistics operating segments and a net loss of $794 million related to the annual MTM retirement plans accounting adjustment. The second quarter of 2020 includes asset impairment charges of $66 million related to the permanent retirement of 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express.
[2] The fourth quarter, third quarter, second quarter and first quarter of 2019 include $84 million, $69 million, $114 million and $121 million, respectively, of TNT Express integration expenses (including any restructuring charges). The fourth quarter and third quarter of 2019 include business realignment costs of $316 million and $4 million, respectively. The fourth quarter includes a net loss of $3.9 billion related to the annual MTM retirement plans accounting adjustment. The second quarter of 2019 includes costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
[3] International revenue includes shipments that either originate in or are destined to locations outside the United States, which could include U.S. payors. Noncurrent assets include property and equipment, goodwill and other long-term assets. Our flight equipment is registered in the U.S. and is included as U.S. assets; however, many of our aircraft operate internationally.
[4] Prior year amounts have been revised to conform to the current year presentation.
v3.20.2
Supplemental Cash Flow Information -Supplemental Cash Flow (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Supplemental Cash Flow Information [Abstract]      
Interest (net of capitalized interest) $ 639 $ 617 $ 524
Income taxes 389 407 760
Income tax refunds received (353) (36) (571)
Cash tax payments, net $ 36 $ 371 $ 189
v3.20.2
Commitments - Schedule of Purchase Commitments (Details)
$ in Millions
May 31, 2020
USD ($)
Unrecorded Unconditional Purchase Obligation [Line Items]  
2021 $ 3,126
2022 3,362
2023 2,443
2024 960
2025 886
Thereafter 3,120
Total 13,897
Aircraft And Related Equipment Commitments [Member]  
Unrecorded Unconditional Purchase Obligation [Line Items]  
2021 2,177
2022 2,772
2023 2,036
2024 697
2025 660
Thereafter 2,723
Total 11,065
Other Commitments [Member]  
Unrecorded Unconditional Purchase Obligation [Line Items]  
2021 949 [1]
2022 590 [1]
2023 407 [1]
2024 263 [1]
2025 226 [1]
Thereafter 397 [1]
Total $ 2,832 [1]
[1] Primarily equipment and advertising contracts.
v3.20.2
Commitments - Additional Information (Details)
$ in Millions
 3 Months Ended 12 Months Ended
Jun. 25, 2020
air-craft
May 31, 2020
USD ($)
air-craft
May 31, 2020
USD ($)
air-craft
Other Aircraft Commitments Disclosure [Abstract]      
Deposit and Progress Payments | $   $ 633 $ 633
B767F [Member]      
Other Aircraft Commitments Disclosure [Abstract]      
Conditional Aircraft Commitments     1
Number of additional aircraft agreed to purchase options exercised   6 6
Aircraft expected to be delivered, fiscal year     2022
B767F [Member] | Subsequent Event [Member]      
Other Aircraft Commitments Disclosure [Abstract]      
Number of aircrafts rescheduled delivery, 2021 18    
Number of aircrafts rescheduled delivery, 2022 11    
Number of aircrafts rescheduled delivery, 2023 13    
Number of aircrafts rescheduled delivery, 2024 4    
B777F [Member]      
Other Aircraft Commitments Disclosure [Abstract]      
Conditional Aircraft Commitments     6
B777F Aircraft from 2023 to 2022 [Member]      
Other Aircraft Commitments Disclosure [Abstract]      
Number of aircrafts rescheduled delivery   2 2
Aircraft expected to be delivered, earliest fiscal year     2022
Aircraft expected to be delivered, latest fiscal year     2023
B767F Aircraft from 2022 to 2023 [Member]      
Other Aircraft Commitments Disclosure [Abstract]      
Number of aircrafts rescheduled delivery   2 2
Aircraft expected to be delivered, earliest fiscal year     2022
Aircraft expected to be delivered, latest fiscal year     2023
B767F Aircraft from 2020 to 2021 [Member]      
Other Aircraft Commitments Disclosure [Abstract]      
Number of aircrafts rescheduled delivery   4 4
Aircraft expected to be delivered, earliest fiscal year   2020  
Aircraft expected to be delivered, latest fiscal year   2021  
B767F Aircraft from 2021 to 2022 [Member]      
Other Aircraft Commitments Disclosure [Abstract]      
Number of aircrafts rescheduled delivery   2 2
Aircraft expected to be delivered, earliest fiscal year   2021  
Aircraft expected to be delivered, latest fiscal year   2022  
Cessna Sky Courier 408 Aircraft [Member]      
Other Aircraft Commitments Disclosure [Abstract]      
Aircraft expected to be delivered, earliest fiscal year   2021  
Aircraft expected to be delivered, latest fiscal year   2026  
ATR 72-600F [Member]      
Other Aircraft Commitments Disclosure [Abstract]      
Aircraft expected to be delivered, earliest fiscal year   2021  
Aircraft expected to be delivered, latest fiscal year   2026  
v3.20.2
Commitments - Schedule of Aircraft Purchase Commitments (Details)
 12 Months Ended
May 31, 2020
air-craft
Schedule of Aircraft Commitments [Line Items]  
2021 26
2022 39
2023 28
2024 22
2025 20
Thereafter 6
Total 141
Cessna SkyCourier 408 [Member]  
Schedule of Aircraft Commitments [Line Items]  
2022 9
2023 12
2024 12
2025 12
Thereafter 5
Total 50
ATR 72-600F [Member]  
Schedule of Aircraft Commitments [Line Items]  
2021 4
2022 7
2023 6
2024 6
2025 6
Thereafter 1
Total 30
B767F [Member]  
Schedule of Aircraft Commitments [Line Items]  
2021 20
2022 18
2023 8
Total 46
B777F [Member]  
Schedule of Aircraft Commitments [Line Items]  
2021 2
2022 5
2023 2
2024 4
2025 2
Total 15
v3.20.2
Contingencies - Additional Information (Details)
 12 Months Ended
May 31, 2020
USD ($)
Loss Contingencies [Line Items]  
Litigation, final settlement amount $ 35,000,000
Attorneys fees recognized in connection with underlying lawsuits 10,000,000
Minimum [Member]  
Loss Contingencies [Line Items]  
Proceedings of environmental matters 100,000
Monetary sanctions and fines related to violations of environmental laws $ 100,000
v3.20.2
Related Party Transactions (Details)
 12 Months Ended
May 31, 2020
Frederick W. Smith [Member] | Washington D.C. National Football League [Member]  
Related Party Transaction [Line Items]  
Related party ownership interest 10.00%
v3.20.2
Summary of Quarterly Operating Results (Unaudited) (Details) - USD ($)
$ / shares in Units, $ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
 [1]
Feb. 29, 2020
 [1]
Nov. 30, 2019
 [1]
Aug. 31, 2019
 [1]
May 31, 2019
 [2]
Feb. 28, 2019
 [2]
Nov. 30, 2018
 [2]
Aug. 31, 2018
 [2]
May 31, 2020
May 31, 2019
May 31, 2018
Selected Quarterly Financial Information [Abstract]                      
Revenues $ 17,358 $ 17,487 $ 17,324 $ 17,048 $ 17,807 $ 17,010 $ 17,824 $ 17,052 $ 69,217 [3] $ 69,693 [3],[4] $ 65,450 [3],[4]
Operating income 475 411 554 977 1,316 911 1,168 1,071 2,417 [5] 4,466 [6] 4,272 [7]
Net income $ (334) [8] $ 315 [8] $ 560 [8] $ 745 [8] $ (1,969) [9] $ 739 [9] $ 935 [9] $ 835 [9] $ 1,286 $ 540 $ 4,572
Basic earnings (loss) per common share $ (1.28) [10] $ 1.21 [10] $ 2.15 [10] $ 2.86 [10] $ (7.56) [10] $ 2.83 [10] $ 3.56 [10] $ 3.15 [10] $ 4.92 $ 2.06 $ 17.08
Diluted earnings (loss) per common share $ (1.28) [10] $ 1.20 [10] $ 2.13 [10] $ 2.84 [10] $ (7.56) [10] $ 2.80 [10] $ 3.51 [10] $ 3.10 [10] $ 4.90 $ 2.03 $ 16.79
[1] The fourth quarter, third quarter, second quarter and first quarter of 2020 include $63 million, $72 million, $64 million and $71 million, respectively, of TNT Express integration expenses. The fourth quarter includes $369 million of goodwill and other asset impairment charges associated with the FedEx Office and FedEx Logistics operating segments and a net loss of $794 million related to the annual MTM retirement plans accounting adjustment. The second quarter of 2020 includes asset impairment charges of $66 million related to the permanent retirement of 10 Airbus A310-300 aircraft and 12 related engines at FedEx Express.
[2] The fourth quarter, third quarter, second quarter and first quarter of 2019 include $84 million, $69 million, $114 million and $121 million, respectively, of TNT Express integration expenses (including any restructuring charges). The fourth quarter and third quarter of 2019 include business realignment costs of $316 million and $4 million, respectively. The fourth quarter includes a net loss of $3.9 billion related to the annual MTM retirement plans accounting adjustment. The second quarter of 2019 includes costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
[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.
[4] Prior year amounts have been revised to conform to the current year presentation.
[5] Includes TNT Express integration expenses of $270 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes noncash goodwill and other asset impairment charges of $435 million primarily related to goodwill impairment at FedEx Office and from the decision to permanently retire certain aircraft and related engines at FedEx Express.
[6] Includes TNT Express integration expenses (including restructuring charges) of $388 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes business realignment costs of $320 million included in “Corporate, other and eliminations” and costs incurred in connection with the settlement of a legal matter involving FedEx Ground of $46 million.
[7] Includes TNT Express integration expenses (including restructuring charges) of $477 million. 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 included in “Corporate, other and eliminations.”
[8] The fourth quarter of 2020 includes a tax benefit of $71 million in connection with the 2020 U.S. tax loss that can be offset against income in prior years under the CARES Act and a tax expense of $51 million due to a change in deferred tax balances related to foreign tax operations. The second quarter of 2020 includes a tax benefit of $133 million from the reduction of a valuation allowance on certain foreign tax loss carryforwards.
[9] The third quarter of 2019 includes a tax benefit of $90 million from the reduction of a valuation allowance on certain tax loss carryforwards and a tax expense of $50 million related to a lower tax rate in the Netherlands applied to our deferred tax balances. The second quarter of 2019 includes a tax benefit of approximately $60 million from accelerated deductions claimed on our 2018 U.S. income tax return. In addition, we recognized a tax expense of $4 million in the second quarter of 2019 as a revision of the provisional benefit associated with the remeasurement of our net U.S. deferred tax liability upon completion of the accounting for the tax effects of the TCJA.
[10] The sum of the quarterly earnings per share may not equal annual amounts due to differences in the weighted-average number of shares outstanding during the respective periods.
v3.20.2
Summary of Quarterly Operating Results (Unaudited) (Parenthetical) (Details) - USD ($)
$ in Millions
 3 Months Ended 12 Months Ended
May 31, 2020
Feb. 29, 2020
Nov. 30, 2019
Aug. 31, 2019
May 31, 2019
Feb. 28, 2019
Nov. 30, 2018
Aug. 31, 2018
May 31, 2020
May 31, 2019
May 31, 2018
Selected Quarterly Financial Information [Line Items]                      
Retirement plans mark-to-market adjustment $ 794       $ 3,900       $ 794 $ 3,882 $ (10)
Integration expenses 63 $ 72 $ 64 $ 71 84 $ 69 $ 114 $ 121 270 388 477
Goodwill and other asset impairment charges     66           435   380
Benefit from reduction of valuation allowance on tax loss carryforwards     $ 133     90     133 90  
Deferred income tax expense 51               348 (85) (183)
PROVISION FOR INCOME TAXES (BENEFIT)                 383 115 $ (219)
Business realignment costs         $ 316 4       320  
Income tax benefit from accelerated deductions to be claimed on 2018 tax return             60     (75)  
Increase (Decrease) in Income Taxes             4        
Netherlands [Member]                      
Selected Quarterly Financial Information [Line Items]                      
PROVISION FOR INCOME TAXES (BENEFIT)           $ 50          
CARES Act [Member]                      
Selected Quarterly Financial Information [Line Items]                      
PROVISION FOR INCOME TAXES (BENEFIT) (71)               $ (71)    
FedEx Office and FedEx Logistics Operating Segments [Member]                      
Selected Quarterly Financial Information [Line Items]                      
Goodwill and other asset impairment charges $ 369                    
FedEx Ground Segment [Member]                      
Selected Quarterly Financial Information [Line Items]                      
Settlement of a legal matter             $ 46     $ 46  
v3.20.2
Valuation and Qualifying Accounts (Details) - USD ($)
$ in Millions
 12 Months Ended
May 31, 2020
May 31, 2019
May 31, 2018
Allowance For Doubtful Accounts [Member]      
Movement In Valuation Allowances And Reserves Roll Forward      
Valuation Allowances And Reserves Beginning Balance $ 121 $ 199 $ 115
Charged To Expenses 442 295 246
Deductions [1] 388 373 162
Valuation Allowances And Reserves Ending Balance 175 121 199
Allowance For Revenue Adjustments [Member]      
Movement In Valuation Allowances And Reserves Roll Forward      
Valuation Allowances And Reserves Beginning Balance 179 202 137
Charged To Other Accounts [2] 1,286 1,192 1,173
Deductions [3] 1,250 1,215 1,108
Valuation Allowances And Reserves Ending Balance 215 179 202
Inventory Valuation Allowance [Member]      
Movement In Valuation Allowances And Reserves Roll Forward      
Valuation Allowances And Reserves Beginning Balance 335 268 237
Charged To Expenses 33 28 27
Charged To Other Accounts   75 6
Deductions 33 36 2
Valuation Allowances And Reserves Ending Balance $ 335 $ 335 $ 268
[1] Uncollectible accounts written off, net of recoveries, and other adjustments.
[2] Principally charged against revenue.
[3] Service failures, rebills and other.