Package delivery company FedEx Corp reported a sharply lower quarterly profit due to the global economic downturn and said it was taking fresh actions to cut costs.

The Memphis-based company reported net income for its fiscal third quarter, ended February 28, of $97 million, or 31 cents a share, down more than 75 percent from $393 million, or $1.26 a share, a year earlier.

Analysts had expected 46 cents a share, according to Reuters Estimates.

Like its main rival, Atlanta-based United Parcel Service Inc, FedEx is considered a bellwether of U.S. economic activity. When the economy does well, companies and consumers ship more goods; in a recession, package volumes drop.

FedEx said third-quarter revenue fell 14 percent to $8.14 billion.

The company said it was cutting capacity at its FedEx Express and FedEx Freight units, and reducing personnel and work hours.

FedEx said the measures would result in fourth-quarter charges of roughly $100 million and lead to a reduction in expenses of about $1 billion in its 2010 fiscal year.

In premarket trade FedEx shares were down 4.2 percent at $41.25.

(Reporting by Nick Carey, editing by John Wallace)