FEDEX CORP, 10-K filed on 7/19/2021
Annual Report
v3.21.2
Document and Entity Information - USD ($)
$ in Billions
12 Months Ended
May 31, 2021
Jul. 15, 2021
Nov. 30, 2020
Document Information [Line Items]      
Document Type 10-K    
Document Period End Date May 31, 2021    
Amendment Flag false    
Document Fiscal Year Focus 2021    
Document Fiscal Period Focus FY    
Entity Registrant Name FedEx Corporation    
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     $ 70.2
Entity Common Stock, Shares Outstanding   267,348,232  
Entity Incorporation, State or Country Code DE    
Document Annual Report true    
Document Transition Report false    
ICFR Auditor Attestation Flag true    
Documents Incorporated by Reference

Portions of the Registrant’s definitive proxy statement to be delivered to stockholders in connection with the 2021 annual meeting of stockholders to be held on September 27, 2021 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 $0.10 per share    
Security Exchange Name NYSE    
0.450% Notes Due 2025 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 25A    
Title of 12(b) Security 0.450% Notes due 2025    
Security Exchange Name NYSE    
1.625% Notes Due 2027 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 27    
Title of 12(b) Security 1.625% Notes due 2027    
Security Exchange Name NYSE    
0.450% Notes Due 2029 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 29A    
Title of 12(b) Security 0.450% Notes due 2029    
Security Exchange Name NYSE    
1.300% Notes Due 2031 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 31    
Title of 12(b) Security 1.300% Notes due 2031    
Security Exchange Name NYSE    
0.950% Notes Due 2033 [Member]      
Document Information [Line Items]      
Trading Symbol FDX 33    
Title of 12(b) Security 0.950% Notes due 2033    
Security Exchange Name NYSE    
v3.21.2
Consolidated Balance Sheets - USD ($)
$ in Millions
May 31, 2021
May 31, 2020
CURRENT ASSETS    
Cash and cash equivalents $ 7,087 $ 4,881
Receivables, less allowances of $742 and $390 12,069 10,102
Spare parts, supplies and fuel, less allowances of $349 and $335 587 572
Prepaid expenses and other 837 828
Total current assets 20,580 16,383
PROPERTY AND EQUIPMENT, AT COST    
Aircraft and related equipment 26,268 24,518
Package handling and ground support equipment 13,012 11,382
Information technology 7,486 6,884
Vehicles and trailers 9,282 9,101
Facilities and other 14,029 13,139
Gross property and equipment 70,077 65,024
Less accumulated depreciation and amortization 34,325 31,416
Net property and equipment 35,752 33,608
OTHER LONG-TERM ASSETS    
Operating lease right-of-use assets, net 15,383 13,917
Goodwill 6,992 6,372
Other assets 4,070 3,257
Total other long-term assets 26,445 23,546
ASSETS [1] 82,777 73,537
CURRENT LIABILITIES    
Current portion of long-term debt 146 51
Accrued salaries and employee benefits 2,903 1,569
Accounts payable 3,841 3,269
Operating lease liabilities 2,208 1,923
Accrued expenses 4,562 3,532
Total current liabilities 13,660 10,344
LONG-TERM DEBT, LESS CURRENT PORTION 20,733 21,952
OTHER LONG-TERM LIABILITIES    
Deferred income taxes 3,927 3,162
Pension, postretirement healthcare and other benefit obligations 3,501 5,019
Self-insurance accruals 2,430 2,104
Operating lease liabilities 13,375 12,195
Other liabilities 983 466
Total other long-term liabilities 24,216 22,946
COMMITMENTS AND CONTINGENCIES
COMMON STOCKHOLDERS' INVESTMENT    
Common stock, $0.10 par value; 800 million shares authorized; 318 million shares issued as of May 31, 2021 and 2020 32 32
Additional paid-in capital 3,481 3,356
Retained earnings 29,817 25,216
Accumulated other comprehensive loss (732) (1,147)
Treasury stock, at cost (8,430) (9,162)
Total common stockholders’ investment 24,168 18,295
LIABILITIES AND COMMON STOCKHOLDERS' INVESTMENT $ 82,777 $ 73,537
[1] Segment assets include intercompany receivables.
v3.21.2
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Millions
May 31, 2021
May 31, 2020
CURRENT ASSETS    
Allowances for receivables $ 742 $ 390
Allowances for spare parts, supplies and fuel $ 349 $ 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
v3.21.2
Consolidated Statements of Income - USD ($)
$ in Millions
12 Months Ended
May 31, 2021
May 31, 2020
May 31, 2019
Income Statement [Abstract]      
REVENUE [1] $ 83,959 $ 69,217 $ 69,693 [2]
OPERATING EXPENSES:      
Salaries and employee benefits 30,173 25,031 24,776
Purchased transportation 21,674 17,466 16,654
Rentals and landing fees 4,155 3,712 3,360
Depreciation and amortization 3,793 3,615 3,353
Fuel 2,882 3,156 3,889
Maintenance and repairs 3,328 2,893 2,834
Business realignment costs 116   320
Goodwill and other asset impairment charges   435  
Other 11,981 10,492 10,041
OPERATING EXPENSES 78,102 66,800 65,227
OPERATING INCOME 5,857 [3] 2,417 [4] 4,466 [5]
OTHER (EXPENSE) INCOME:      
Interest expense (793) (672) (588)
Interest income 52 55 59
Other retirement plans income (expense) 1,983 (122) (3,251)
Loss on debt extinguishment (393)    
Other, net (32) (9) (31)
OTHER (EXPENSE) INCOME 817 (748) (3,811)
INCOME BEFORE INCOME TAXES 6,674 1,669 655
PROVISION FOR INCOME TAXES 1,443 383 115
NET INCOME $ 5,231 $ 1,286 $ 540
BASIC EARNINGS PER COMMON SHARE $ 19.79 $ 4.92 $ 2.06
DILUTED EARNINGS PER COMMON SHARE $ 19.45 $ 4.90 $ 2.03
[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 $210 million. These expenses are included in “Corporate, other and eliminations” and the FedEx Express segment. Also includes business realignment costs of $116 million included in the FedEx Express segment.
[4] 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.
[5] 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 $46 million.
v3.21.2
Consolidated Statements of Comprehensive Income - USD ($)
$ in Millions
12 Months Ended
May 31, 2021
May 31, 2020
May 31, 2019
Statement Of Income And Comprehensive Income [Abstract]      
NET INCOME $ 5,231 $ 1,286 $ 540
OTHER COMPREHENSIVE LOSS:      
Foreign currency translation adjustments, net of tax expense of $13 in 2021 and tax benefits of $18 in 2020 and $29 in 2019 422 (254) (195)
Amortization of prior service credit and other, net of tax benefits of $3 in 2021, $25 in 2020, and $28 in 2019 (7) (79) (92)
Other comprehensive income (loss) 415 (333) (287)
COMPREHENSIVE INCOME $ 5,646 $ 953 $ 253
v3.21.2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($)
$ in Millions
12 Months Ended
May 31, 2021
May 31, 2020
May 31, 2019
Other Comprehensive Income, Tax Amounts      
Foreign currency translation adjustments, tax expense (benefit) $ 13 $ (18) $ (29)
Amortization of prior service credit and other, tax benefits $ 3 $ 25 $ 28
v3.21.2
Consolidated Statements of Cash Flows - USD ($)
$ in Millions
12 Months Ended
May 31, 2021
May 31, 2020
May 31, 2019
OPERATING ACTIVITIES      
Net income $ 5,231 $ 1,286 $ 540
Adjustments to reconcile net income to cash provided by operating activities:      
Depreciation and amortization 3,793 3,615 3,353
Provision for uncollectible accounts 577 442 295
Other noncash items including leases and deferred income tax 2,887 2,449 (233)
Stock-based compensation 200 168 174
Retirement plans mark-to-market adjustments (1,176) 794 3,882
Loss on extinguishment of debt 393    
Gain from sale of business     (8)
Business realignment costs 102   101
Goodwill and other asset impairment charges   435  
Changes in assets and liabilities:      
Receivables (1,389) (1,331) (873)
Other current assets (40) (59) (25)
Pension and postretirement healthcare assets and liabilities, net (317) (908) (909)
Accounts payable and other liabilities 71 (1,787) (571)
Other, net (197) (7) (113)
Cash provided by operating activities 10,135 5,097 5,613
INVESTING ACTIVITIES      
Capital expenditures (5,884) (5,868) (5,490)
Business acquisitions, net of cash acquired (228)   (66)
Proceeds from asset dispositions and other 102 22 83
Cash used in investing activities (6,010) (5,846) (5,473)
FINANCING ACTIVITIES      
Payments on debt (6,318) (2,548) (1,436)
Proceeds from debt issuances 4,212 6,556 2,463
Proceeds from stock issuances 740 64 101
Dividends paid (686) (679) (683)
Purchase of treasury stock   (3) (1,480)
Other, net (38) (9) (4)
Cash (used in) provided by financing activities (2,090) 3,381 (1,039)
Effect of exchange rate changes on cash 171 (70) (47)
Net increase (decrease) in cash and cash equivalents 2,206 2,562 (946)
Cash and cash equivalents at beginning of period 4,881 2,319 3,265
Cash and cash equivalents at end of period $ 7,087 $ 4,881 $ 2,319
v3.21.2
Consolidated Statements of Changes in Common Stockholders' Investment - USD ($)
$ in Millions
12 Months Ended
May 31, 2021
May 31, 2020
May 31, 2019
Beginning Balance $ 18,295 $ 17,757 $ 19,416
Net income 5,231 1,286 540
Other comprehensive gain (loss), net of tax 415 (333) (287)
Purchase of treasury stock   (3) (1,480)
Cash dividends declared (686) (679) (683)
Employee incentive plans and other 913 220 251
Ending Balance 24,168 18,295 17,757
Accounting Standards Update 2018-02      
Reclassification to retained earnings due to the adoption of a new accounting standard on June 1, 2019 [1]   51  
Cumulative Effect, Period of Adoption, Adjustment | Accounting Standards Update 2016-02 and 2018-02      
Beginning Balance [2] (4)    
Ending Balance [2]   (4)  
Common Stock      
Beginning Balance 32 32 32
Ending Balance 32 32 32
Additional Paid-In Capital      
Beginning Balance 3,356 3,231 3,117
Employee incentive plans and other 125 125 114
Ending Balance 3,481 3,356 3,231
Retained Earnings      
Beginning Balance 25,216 24,648 24,823
Net income 5,231 1,286 540
Cash dividends declared (686) (679) (683)
Employee incentive plans and other 56 (35) (32)
Ending Balance 29,817 25,216 24,648
Retained Earnings | Cumulative Effect, Period of Adoption, Adjustment | Accounting Standards Update 2016-02 and 2018-02      
Beginning Balance [2] (4)    
Ending Balance [2]   (4)  
Accumulated Other Comprehensive Loss      
Beginning Balance (1,147) (865) (578)
Other comprehensive gain (loss), net of tax 415 (333) (287)
Ending Balance (732) (1,147) (865)
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 [1]   51  
Treasury Stock      
Beginning Balance (9,162) (9,289) (7,978)
Purchase of treasury stock   (3) (1,480)
Employee incentive plans and other 732 130 169
Ending Balance $ (8,430) $ (9,162) $ (9,289)
[1] Relates to the adoption of ASU 2018-02.
[2] Relates to the adoption of Accounting Standards Update (“ASU”) 2016-02 and ASU 2018-02
v3.21.2
Consolidated Statements of Changes in Common Stockholders' Investment (Parenthetical) - USD ($)
$ in Millions
12 Months Ended
May 31, 2021
May 31, 2020
May 31, 2019
Statement Of Stockholders Equity [Abstract]      
Other comprehensive loss, tax $ 10 $ (43) $ (57)
Purchase of treasury stock   20,000.00 6,600,000
Cash dividends declared, per share $ 2.60 $ 2.60 $ 2.60
Employee incentive plans and other, shares issued 5,400,000 1,000,000.0 1,300,000
v3.21.2
Description of Business Segments and Summary of Significant Accounting Policies
12 Months Ended
May 31, 2021
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 collaboratively and innovating digitally, 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 operating segments.

FISCAL YEARS. Except as otherwise specified, references to years indicate our fiscal year ended May 31, 2021 or ended May 31 of the year referenced.

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 FedEx 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 $715 million and $563 million at May 31, 2021 and May 31, 2020, respectively. Contract assets net of deferred unearned revenue were $572 million and $456 million at May 31, 2021 and May 31, 2020, respectively. Contract assets are included within current assets in the accompanying consolidated balance sheets. Contract liabilities related to advance payments from customers were $9 million and $10 million at May 31, 2021 and May 31, 2020, 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 and duties, 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 15 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 $428 million in 2021, $427 million in 2020 and $468 million in 2019.

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, including implementation of cloud computing service arrangements. 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

 

2021

 

 

2020

 

Wide-body aircraft and related equipment

 

15 to 30 years

 

$

14,812

 

 

$

13,448

 

Narrow-body and feeder aircraft and related equipment

 

5 to 30 years

 

 

2,307

 

 

 

2,478

 

Package handling and ground support equipment

 

3 to 30 years

 

 

5,269

 

 

 

4,499

 

Information technology

 

2 to 10 years

 

 

1,863

 

 

 

1,795

 

Vehicles and trailers

 

3 to 15 years

 

 

4,033

 

 

 

4,345

 

Facilities and other

 

2 to 40 years

 

 

7,468

 

 

 

7,043

 

 

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 $3.8 billion in 2021, $3.6 billion in 2020 and $3.4 billion in 2019. Depreciation and amortization expense includes amortization of assets under finance leases.

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 $68 million in 2021, $54 million in 2020 and $64 million in 2019.

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.

During 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 2020.

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, 2021, we had nine aircraft temporarily idled. These aircraft have been idled for an average of 17 months and are expected to return to revenue service.

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 5 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 1 to 15 years, either on a straight-line basis or on a basis consistent with the pattern in which the economic benefits are realized. See Note 5 for additional information.

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, property and cargo loss, 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. Claims costs are recognized on a gross basis and a receivable is recorded for amounts covered by third party insurance. 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. Short-term leases with an initial term of 12 months or less are not recognized in the right-to-use asset and lease liability on the consolidated balance sheets.

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 8 for additional information.

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. As of May 31, 2021, we designated €210 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, 2021, 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. Bargaining for a successor agreement began in May 2021. A small number of our other 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 2021, we did not repurchase any shares of FedEx common stock. As of May 31, 2021, 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 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. 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.

Effective March 16, 2021, we further amended our amended and restated $2.0 billion five-year credit agreement (the “Five-Year Credit Agreement”) and entered into a new $1.5 billion 364-day credit agreement (the “364-Day Credit Agreement” and together with the Five-Year Credit Agreement, the “Credit Agreements”). The Credit Agreements no longer contain the temporary covenant added in the fourth quarter of 2020 restricting us from repurchasing any shares of our common stock. See Note 7 for more information on the Credit Agreements.

DIVIDENDS DECLARED PER COMMON SHARE. On June 14, 2021, our Board of Directors declared a quarterly dividend of $0.75 per share of common stock. The dividend was paid on July 12, 2021 to stockholders of record as of the close of business on June 28, 2021. 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. Effective March 16, 2021, the Credit Agreements no longer contain the temporary covenant added in the fourth quarter of 2020 restricting us from increasing the amount of our quarterly dividend payable per share of common stock from $0.65 per share. There are no 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. In January 2021, FedEx Express announced a workforce reduction plan in Europe as it nears the completion of the network integration of TNT Express. The plan will impact between 5,500 and 6,300 employees in Europe across operational teams and back-office functions. The execution of the plan is subject to a works council consultation process that will occur over an 18-month period in accordance with local country processes and regulations.

We incurred costs during 2021 of $116 million ($90 million, net of tax, or $0.33 per diluted share) associated with our business realignment activities. These costs are related to certain employee severance arrangements. Approximately $15 million was paid under this program in 2021. We expect the pre-tax cost of our business realignment activities to range from $300 million to $575 million through fiscal 2023. The actual amount and timing of business realignment costs and related cost savings resulting from the workforce reduction plan are dependent on local country consultation processes and regulations and negotiated social plans.

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 of $320 million were recognized in 2019 when eligible employees accepted their offers, and included approximately $50 million of costs associated with funding to healthcare reimbursement accounts. Severance 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) that rely on projections of future cash flows; and purchase price allocations.

v3.21.2
Recent Accounting Guidance
12 Months Ended
May 31, 2021
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 June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-13 that amends the impairment model for most financial assets and certain other instruments that are not measured at fair value through net income, including trade receivables, to utilize an expected loss methodology in place of the incurred loss methodology. We adopted this standard effective June 1, 2020. We updated our process for estimating the expected credit loss to include a review of forecast information that may impact expected collectability over the lifetime of the asset. See Note 3 for additional information. The adoption of this standard did 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 and applied these changes prospectively. The adoption of this standard did 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. We early adopted this standard effective June 1, 2020. The adoption of this standard did not have a material impact on our consolidated financial statements and related disclosures.

v3.21.2
Credit Losses
12 Months Ended
May 31, 2021
Credit Loss [Abstract]  
Credit Losses

NOTE 3: CREDIT LOSSES

We are exposed to credit losses primarily through our trade receivables. We assess ability to pay for certain customers by conducting a credit review, which considers the customer’s established credit rating and our assessment of creditworthiness. We determine the allowance for credit losses on accounts receivable using a combination of specific reserves for accounts that are deemed to exhibit credit loss indicators and general reserves that are determined using loss rates based on historical write-offs by geography and recent forecast information, including underlying economic expectations. We update our estimate of credit loss reserves quarterly, considering recent write-offs, collections information and underlying economic expectations.

Credit losses were $577 million in 2021, $442 million in 2020 and $295 million in 2019. Our allowance for credit losses was $358 million as of May 31, 2021 and $175 million at May 31, 2020.

v3.21.2
Business Combinations
12 Months Ended
May 31, 2021
Business Combinations [Abstract]  
Business Combinations

NOTE 4: BUSINESS COMBINATIONS

On December 23, 2020, we acquired ShopRunner, Inc. (“ShopRunner”), an e-commerce platform that directly connects brands and merchants with online shoppers, for $228 million in cash from operations. The majority of the purchase price was allocated to goodwill and intangibles. The financial results of ShopRunner are included in “Corporate, other and eliminations” from the date of acquisition and were not material to our results of operations; therefore, pro forma financial information has not been provided.

On May 1, 2019, we acquired the international express division of FC (Flying Cargo) Express Ltd. 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.

v3.21.2
Goodwill and Other Intangible Assets
12 Months Ended
May 31, 2021
Goodwill And Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangible Assets

NOTE 5: 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, 2019

 

$

5,016

 

 

$

840

 

 

$

767

 

 

$

1,945

 

 

$

8,568

 

Accumulated impairment charges

 

 

 

 

 

 

 

 

(133

)

 

 

(1,551

)

 

 

(1,684

)

Balance as of May 31, 2019

 

 

5,016

 

 

 

840

 

 

 

634

 

 

 

394

 

 

 

6,884

 

Impairment charges

 

 

 

 

 

 

 

 

 

 

 

(358

)

 

 

(358

)

Other(1)

 

 

(147

)

 

 

 

 

 

 

 

 

(7

)

 

 

(154

)

Balance as of May 31, 2020

 

 

4,869

 

 

 

840

 

 

 

634

 

 

 

29

 

 

 

6,372

 

Goodwill acquired(2)

 

 

18

 

 

 

103

 

 

 

 

 

 

40

 

 

 

161

 

Other(1)

 

 

471

 

 

 

 

 

 

 

 

 

(12

)

 

 

459

 

Balance as of May 31, 2021

 

$

5,358

 

 

$

943

 

 

$

634

 

 

$

57

 

 

$

6,992

 

Accumulated goodwill impairment charges

   as of May 31, 2021

 

$

 

 

$

 

 

$

(133

)

 

$

(1,909

)

 

$

(2,042

)

 

(1)

Primarily currency translation adjustments and purchase price allocation-related adjustments.

(2)

Goodwill acquired relates to the acquisition of ShopRunner. See Note 4 for more information.

Our reporting units with significant recorded goodwill include FedEx Express, FedEx Ground and FedEx Freight. We evaluated these reporting units during the fourth quarter and the estimated fair value of each of these reporting units exceeded their carrying values as of the end of 2021 and 2020; therefore, we do not believe that any of these reporting units were impaired as of the balance sheet dates.

In 2020, we recorded impairment charges of $358 million predominantly attributable to our FedEx Office and Print Services, Inc. (“FedEx Office”) reporting unit. The coronavirus (“COVID-19”) pandemic resulted in store closures and declining print revenue at FedEx Office during the fourth quarter of 2020. 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. No impairments of goodwill were recognized during 2021 or 2019.

OTHER INTANGIBLE ASSETS. The summary of our intangible assets and related accumulated amortization at May 31, 2021 and 2020 is as follows (in millions):

 

 

 

2021

 

 

2020

 

 

 

Gross

Carrying

Amount

 

 

Accumulated

Amortization

 

 

Net Book

Value

 

 

Gross

Carrying

Amount

 

 

Accumulated

Amortization

 

 

Net Book

Value

 

Customer relationships

 

$

591

 

 

$

(299

)

 

$

292

 

 

$

641

 

 

$

(327

)

 

$

314

 

Technology

 

 

65

 

 

 

(35

)

 

 

30

 

 

 

65

 

 

 

(57

)

 

 

8

 

Trademarks and other

 

 

1

 

 

 

(1

)

 

 

 

 

 

132

 

 

 

(132

)

 

 

 

Total

 

$

657

 

 

$

(335

)

 

$

322

 

 

$

838

 

 

$

(516

)

 

$

322

 

 

Amortization expense for intangible assets was $49 million in 2021, $66 million in 2020 and $82 million in 2019.

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

 

2022

$

52

 

2023

 

49

 

2024

 

48

 

2025

 

47

 

2026

 

46

 

 

v3.21.2
Selected Current Liabilities
12 Months Ended
May 31, 2021
Accounts Payable And Accrued Liabilities Fair Value Disclosure [Abstract]  
Selected Current Liabilities

NOTE 6: SELECTED CURRENT LIABILITIES

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

 

 

 

2021

 

 

2020

 

Accrued Salaries and Employee Benefits

 

 

 

 

 

 

 

 

Salaries

 

$

626

 

 

$

436

 

Employee benefits, including variable compensation

 

 

1,350

 

 

 

319

 

Compensated absences

 

 

927

 

 

 

814

 

 

 

$

2,903

 

 

$

1,569

 

Accrued Expenses

 

 

 

 

 

 

 

 

Self-insurance accruals

 

$

1,535

 

 

$

1,223

 

Taxes other than income taxes

 

 

637

 

 

 

417

 

Other

 

 

2,390

 

 

 

1,892

 

 

 

$

4,562

 

 

$

3,532

 

 

 

v3.21.2
Long-Term Debt and Other Financing Arrangements
12 Months Ended
May 31, 2021
Debt And Capital Lease Obligations [Abstract]  
Long-term Debt and Other Financing Arrangements

NOTE 7: 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, 2021, are as follows (in millions):

 

 

 

 

 

 

 

 

 

May 31,

 

 

 

 

 

 

 

 

 

2021

 

 

2020

 

 

 

Interest Rate%

 

 

Maturity

 

 

 

 

 

 

 

 

Senior secured debt:

 

 

1.875

 

 

2034

 

$

932

 

 

$

 

Senior unsecured debt:

 

 

3.40

 

 

2022

 

 

 

 

 

498

 

 

 

2.625-2.70

 

 

2023

 

 

 

 

 

748

 

 

 

 

4.00

 

 

2024

 

 

 

 

 

747

 

 

 

3.20-3.80

 

 

2025

 

 

 

 

 

1,687

 

 

 

 

3.25

 

 

2026

 

 

746

 

 

 

745

 

 

 

 

3.30

 

 

2027

 

 

 

 

 

446

 

 

 

 

3.40

 

 

2028

 

 

496

 

 

 

496

 

 

 

 

4.20

 

 

2029

 

 

397

 

 

 

397

 

 

 

3.10-4.25

 

 

2030

 

 

1,733

 

 

 

1,732

 

 

 

 

2.40

 

 

2031

 

 

989

 

 

 

 

 

 

 

4.90

 

 

2034

 

 

496

 

 

 

495

 

 

 

 

3.90

 

 

2035

 

 

494

 

 

 

494

 

 

 

 

3.25

 

 

2041

 

 

739

 

 

 

 

 

 

3.875-4.10

 

 

2043

 

 

985

 

 

 

984

 

 

 

 

5.10

 

 

2044

 

 

742

 

 

 

742

 

 

 

 

4.10

 

 

2045

 

 

641

 

 

 

641

 

 

 

4.55-4.75

 

 

2046

 

 

2,461

 

 

 

2,461

 

 

 

 

4.40

 

 

2047

 

 

736

 

 

 

735

 

 

 

 

4.05

 

 

2048

 

 

986

 

 

 

986

 

 

 

 

4.95

 

 

2049

 

 

836

 

 

 

835

 

 

 

 

5.25

 

 

2050

 

 

1,226

 

 

 

1,225

 

 

 

 

4.50

 

 

2065

 

 

246

 

 

 

246

 

 

 

 

7.60

 

 

2098

 

 

237

 

 

 

237

 

Euro senior unsecured debt:

 

 

0.70

 

 

2022

 

 

 

 

 

695

 

 

 

 

1.00

 

 

2023

 

 

 

 

 

815

 

 

 

 

0.45

 

 

2026

 

 

607

 

 

 

541

 

 

 

 

1.625

 

 

2027

 

 

1,516

 

 

 

1,351

 

 

 

 

0.45

 

 

2029

 

 

725

 

 

 

 

 

 

 

1.30

 

 

2032

 

 

604

 

 

 

539

 

 

 

 

0.95

 

 

2033

 

 

784

 

 

 

 

Total senior unsecured debt

 

 

 

 

 

 

 

 

19,422

 

 

 

21,518

 

Finance lease obligations

 

 

 

 

 

 

 

 

525

 

 

 

485

 

 

 

 

 

 

 

 

 

 

20,879

 

 

 

22,003

 

Less current portion

 

 

 

 

 

 

 

 

146

 

 

 

51

 

 

 

 

 

 

 

 

 

$

20,733

 

 

$

21,952

 

 

Interest on our U.S. dollar fixed-rate notes is paid semi-annuall