FedEx Corp. (FDX) - Get FedEx Corporation Report issued an apology Tuesday for mishandling packages destined for Huawei Technologies amid accusations that it deliberately diverted four parcels addressed to the Chinese tech giant's offices in Asia.
Huawei said the packages, which contained company documents, were re-routed by FedEx back to the United States, according to a report from Reuters. Huawei said the alleged diversion, which comes just ten days after the Commerce Department put the China-backed group on its so-called Entities List that restricts is access to U.S. markets, would force it to "review" its relationship with the courier.
"We regret that this isolated number of Huawei packages were inadvertently misrouted, and confirm that we were not requested by any external party to divert these packages which are in the process of being returned to the shippers," the company said in a post in Mandarin through its China-based social media account.
FedEx shares fell 1.16% by mid-morning Tuesday to change hands at $158.07 each, a move that would mark the stock's seventh consecutive session decline and tip the stock into a modest year-to-date loss of around 2%.
FedEx cut its full-year profit forecast for the second time in three months in March after reporting weaker-than-expected third quarter earnings linked to the broader global slowdown in trade and package demand.
"Since our last earnings call, we have seen the overall China economy slow down further, and this has impacted other Asian economies," CEO Fred Smith told investors on March 19. "Given the size of China, no markets will be able to absorb more than a fraction of what China produces, but customers continue to look to diversify from China."
"We have also seen some customers evaluate mode optimization. Our network and portfolio lets customers respond quickly and act locally for our customers in China, as well as around the world," he added.
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