Shares of Amazon (AMZN -0.22%) declined on Friday after FedEx (FDX 0.35%) reported a steep drop in profits amid a downturn in global shipping volumes. As of 2:25 p.m. ET, Amazon's stock price was down roughly 3%.
COVID-19-related disruptions in Asia and conflict in Europe are denting demand for FedEx's international shipping solutions. At the same time, the U.S. economy appears to be slowing.
"Global volumes declined as macroeconomic trends significantly worsened later in the quarter, both internationally and in the U.S.," CEO Raj Subramaniam said in a business update to investors.
FedEx said it expects business conditions will "further weaken" in the coming months. In response to this projected downturn in shipping demand, the logistics giant is parking aircraft, cutting labor hours, and closing more than 90 FedEx Office locations.
Worse still, Subramaniam said during an interview with CNBC's Jim Cramer that the economy could soon enter a "worldwide recession." "We're seeing that volume decline in every segment around the world," Subramaniam said.
FedEx's disappointing results and concerning forecast sent chills down the spines of investors. As one of the largest shipping and logistics companies in the world, FedEx has a bird's-eye view of the global economy.
Amazon, as one of the largest retailers and e-commerce companies in the U.S. and many international markets, could be particularly exposed to a global recession. Consumers already appear to be pulling back on discretionary spending as inflation takes a heavy toll on their budgets. These trends could worsen if FedEx's grim view of global economic conditions proves accurate.