Overview
- Shares rose about 10% for the week after UPS topped expectations with adjusted EPS of $1.74 on $21.4 billion in revenue despite year-over-year declines.
- Third-quarter revenue fell 3.7% and adjusted earnings dipped 1.1%, reflecting ongoing pressure even as execution improved.
- UPS reported $2.2 billion of the planned $3.5 billion in annual cost savings through Q3, closing 93 facilities and eliminating about 48,000 jobs.
- U.S. revenue per piece increased 9.8%, and the U.S. operating margin edged up to 6.4% from 6.3%, which management attributed to a focus on revenue quality.
- The company is reducing Amazon volumes by more than 50% by late next year, a notable shift given Amazon’s roughly 25% share of UPS volume and over 11% of revenue last year, while weaker first-half cash flow and a roughly 6.7% dividend yield keep payout durability in focus.