FedEx and UPS were never the ones paying tariffs. They were just the cashiers.
They took the money from importers, handed it to the government, and moved on. After a Supreme Court ruling in February, that cash is starting to flow back the other way.
In February, the Supreme Court ruled on a 1977 law called the IEEPA. That stands for the International Emergency Economic Powers Act.
The court said the law does not give a president the power to set tariffs. The ruling wiped out a wide set of import duties.
The dollar number is large. Court filings cite roughly $166 billion in tariff money that may now be open to refunds.
U.S. Customs and Border Protection started a phased refund system on April 20. Importers and brokers can file claims online.
Most refunds should land within 60 to 90 days of an approved claim.
UPS CEO Carol Tomé walked through her firm's role on the Q1 call. UPS processed 16 million IEEPA-tied entries.
It also sent more than $5 billion in tariffs to the U.S. Treasury. Her line on the refunds: "We are just a pass-through."
Once UPS gets money back from CBP, she said, it goes "right back to our customer." FedEx made a similar pledge.
Whatever it gets back from Customs, it sends to its customers. For both stocks, the refund math should be a wash.
They never kept the cash in the first place. The hit to earnings should be small.
Both stocks still fell on the news. FedEx slipped 2.39% and UPS dropped 1.13%.
The ruling killed tariffs set under IEEPA. Other tariffs are still on the books.
Officials have said new duties could come back through other legal paths. Trade flows took the hit while the duties were active.
Refunds will not undo the earnings damage that importers and exporters took in that window.
The big winners are the importers who paid the tariffs. The refund cash frees them up to invest, hire, or pay down debt.
That can be a tailwind for retail names with foreign supply chains. It also helps auto parts firms and industrials with parts from abroad.
The wild card is what the White House does next. New duties under other legal grounds could land at any time.
That risk caps the upside for now. For FedEx and UPS, the headline number is large.
But the cash is not theirs to keep. Both firms have spent the past year working through the operational lift of processing tariffs.
The refund process is the back end of that work. Logistics names tend to track global trade flows.
As tariff worry fades, freight demand could pick up. That is the read-through that may matter most for the stocks over time.
The $166 billion is the headline. The real test is how fast CBP can move the cash.