General

6 Months Ended

Nov. 30, 2012

General [Abstract]

General

(1) General

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. These interim financial statements of FedEx Corporation (“FedEx”) have been prepared in accordance with accounting principles generally accepted in the United States and Securities and Exchange Commission (“SEC”) instructions for interim financial information, and should be read in conjunction with our Annual Report on Form 10-K for the year ended May 31,2012(“Annual Report”). Accordingly, significant accounting policies and other disclosures normally provided have been omitted sincesuch items are disclosed in our Annual Report.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments (including normal recurring adjustments) necessary to present fairly our financial position as of November 30,2012, the results of our operations for the three- and six-month periods ended November 30, 2012 and 2011 and cash flows for the six-month periods ended November 30,2012 and 2011. Operating results for the three- and six-month periods ended November 30, 2012are not necessarily indicative of the results that may be expected for the year ending May 31,2013.

Except as otherwise specified, references to years indicate our fiscal year ending May 31, 2013 or ended May 31 of the year referenced and comparisons are to the corresponding period of the prior year.

BUSINESS ACQUISITIONS.In the first quarter of 2013, we expanded the international service offerings of FedEx Express by completing the following business acquisitions:

• RapidãoCometaLogística e Transporte S.A., a Brazilian transportation and logistics company, for $398 million in cash from operations on July 4, 2012

• TATEX, a French express transportation company, for $55 million in cash from operations on July 3, 2012
• Opek Sp. z o.o., a Polish domestic express package delivery company, for $54 million in cash from operations on June 13, 2012

These acquisitions give us more robust transportation networks within these countries and added capabilities in these important international markets.

The financial results of these acquired businesses are included in the FedEx Express segment from the date of acquisition and were not material, individually or in the aggregate, to our results of operations and therefore, pro forma financial information has not been presented.

The estimated fair values of the assets and liabilities related to these acquisitions have been recorded in the FedEx Express segment and are included in the accompanying unaudited balance sheet based on a preliminary allocation of the purchase price (summarized in the table below in millions). These allocations will be finalized as soon as the information becomes available and working capital adjustments are completed, which will not exceed one year from the acquisition date.

Current assets	$	143
Property and equipment		88
Goodwill		348
Intangible assets		60
Other non-current assets		68
Current liabilities		(166)
Long-term liabilities		(34)
Total purchase price	$	507

The goodwill of $348 million is primarily attributable to expected benefits from synergies of the combinationswith existing businesses and acquired entities. The portion of the purchase price allocated to goodwill is not deductible for U.S. income tax purposes. The intangible assets acquired consist primarily of customer-related intangible assets, which will be amortized on an accelerated basis over their average estimated useful lives of nine years, with the majority of the amortization recognized during the first five years.

STOCK-BASED COMPENSATION.We have two types of equity-based compensation: stock options and restricted stock. The key terms of the stock option and restricted stock awards granted under our incentive stock plans and all financial disclosures about these programs are set forth in our Annual Report.

Our stock-based compensation expense was $25 million for the three-month period ended November 30, 2012 and $64 millionfor the six-monthperiod ended November 30, 2012. Our stock-based compensation expense was $23 million for the three-month period endedNovember 30,2011 and$60 million for the six-month period ended November 30, 2011.Due to its immateriality, additional disclosures related to stock-based compensation have been excluded from this quarterly report.

NEW ACCOUNTING GUIDANCE.New accounting rules and disclosure requirements can significantly impact our reported results and the comparability of our financial statements.

On June 1, 2012, we adopted the authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) on the presentation of comprehensive income. The new guidance requires companies to report components of comprehensive income by including comprehensive income on the face of the income statement or in a separate statement of comprehensive income. We have adopted this guidance by including a separate statement of comprehensive income for the three-month and six-month periods ended November 30, 2012 and 2011. In addition, on June 1, 2012, we adopted the FASB's amendments to the fair value measurements and disclosure requirements, which expands existing disclosure requirements regarding the fair value of our long-term debt.

We believe that no other new accounting guidance was adopted or issued during the first half of 2013 that is relevant to the readers of our financial statements. However, there are numerous new proposals under development which, if and when enacted, may have a significant impact on our financial reporting.

TREASURY SHARES. During the first quarterof 2013, we repurchased 2.7 millionshares of FedEx common stock at an average price of $91 per share for a total of $246 million. As of November 30, 2012, 188,000 shares remained under existing share repurchase authorizations.

DIVIDENDS DECLARED PER COMMON SHARE. On November 2, 2012, our Board of Directors declared a dividend of $0.14 per share of common stock. The dividend was paid on December 17, 2012 to stockholders of record as of the close of business on November 21, 2012. 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 at the end of each fiscal year.