MEMPHIS, Tenn. - FedEx Corp. said Wednesday its second-quarter profit jumped 33 percent, easily beating Wall Street's predictions and its own. FedEx stock rose to a new 52-week high on the earnings report.
While a strong economy helped, earnings largely were due to a focus on operating costs and promotion of the integrated shipping company's more profitable services, market analysts said.
Overall profit increased to $471 million, or $1.53 a share, over the same period last year, up from $354 million, or $1.15 a share. Revenue grew 10 percent to $8.09 billion from $7.33 billion.
Analysts polled by Thomson Financial expected second-quarter earnings of $1.40 a share on sales of $8.07 billion. The company had forecast profits between $1.30 and $1.45 per share.
Suit claims Sony BMG
violates spyware laws
AUSTIN - Texas Attorney General Greg Abbott expanded his lawsuit against Sony BMG Music Entertainment on Wednesday, alleging that a second form of anti-piracy technology used by the label violates the state's spyware and deceptive trade practices laws.
Abbott sued Sony BMG in November, saying the world's second-largest music label surreptitiously included spyware on millions of CDs through technology known as XCP. That technology could leave computers vulnerable to hackers, he said.
The new allegations involve an unrelated CD copy-protection technology known as MediaMax.
The MediaMax technology limits how many backup copies can be made of the CD on a computer or how the tracks can be shared with other users.
The Electronic Frontier Foundation, an online civil liberty group, discovered that, like XCP, MediaMax could allow an outsider to gain unauthorized access to a computer. Two weeks ago, Sony BMG began urging consumers to download a patch that would plug the potential security breach. About 5.7 million CDs were shipped with the software.
Sony BMG misleads consumers by saying no files will be installed if the agreement is rejected, Abbott said, when, in reality, the installation already has occurred. It is difficult for consumers to remove the files, he added.
Big Easy bonds given Moody's junk status
Municipal bonds from the New Orleans area fared worst among the $9.5 billion of debt placed under review by Moody's Investors Service after the devastation caused by Hurricane Katrina.
The credit-rating company cut its rating on 29 of the 51 municipalities put on review Sept. 8, affecting about $4.8 billion of existing debt. Much of that debt came from the New Orleans area.
New Orleans's credit rating was cut in November to noninvestment grade, or junk, status. The state of Louisiana's general obligation bonds also were cut by Moody's, along with bonds sold to finance the Louisiana Superdome, Tulane University and New Orleans's Touro Infirmary hospital.
''The downgrades centered on the New Orleans area, where the extent and pace of rebuilding remains unclear,'' Moody's said Wednesday. ''New Orleans and its immediate environs face a more uncertain future than do credits in the affected Gulf region outside the New Orleans area.''
Bankruptcy-exit plan
for Atkins gets go-ahead
Atkins Nutritionals Inc., a food company founded by the late diet doctor Robert Atkins, won court approval Wednesday of a reorganization plan that allows it to exit bankruptcy after less than six months.
Atkins, based in New York, filed for bankruptcy protection on July 31 with $325 million of debt, after bigger competitors also introduced low-carbohydrate products.
UnitedHealth gets final OK to buy PacifiCare
MINNEAPOLIS - UnitedHealth Group Inc. has received final regulatory approval for its $9.2 billion purchase of PacifiCare Health Systems, the health insurer said Wednesday.
UnitedHealth agreed to divest parts of PacifiCare's commercial health insurance business in Tucson, Ariz., and Boulder, Colo., to satisfy antitrust regulator concerns, the Justice Department said.
UnitedHealth also agreed to end its network access agreement with Blue Shield of California.
Antitrust regulators objected to the arrangement because absorbing PacifiCare makes UnitedHealth one of Blue Shield of California's main competitors, Justice said.
