Why did UPS raise its full-year 2026 revenue and profit forecasts, and what role did the Amazon volume reduction play?

UPS raised its full-year 2026 revenue forecast to $91.2 billion (up from $89.7 billion) and adjusted earnings forecast to $7.22 per share due to stronger-than-expected domestic demand and successful execution of its 'Amazon glide down'—a planned reduction in low-profit Amazon deliveries, which CEO Carol Tome confirmed was completed 'as designed.' The company stated this pullback, which reduced Amazon’s contribution from over 13% to 8.8% of its business, was necessary because the Amazon business was 'extraordinarily dilutive' to margins, and its completion enabled improved network efficiency and margin expansion, particularly in the U.S. domestic segment, where adjusted operating margin reached 8% in Q2.

What were UPS's second-quarter 2024 financial results compared to analyst expectations, and what factors drove the outperformance?

UPS reported second-quarter 2024 consolidated revenue of $22.83 billion and adjusted profit per share of $1.76—both exceeding analyst estimates of $21.81 billion and $1.66 per share, respectively—driven by higher package volumes, stronger yields, and fuel surcharges that insulated margins from rising energy costs. The company also posted adjusted operating profit of $2.10 billion and noted that its U.S. domestic adjusted operating margin improved to 8%, while international margin stood at 12.4%, underscoring the profitability uplift from its network reconfiguration and Amazon volume reduction.

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UPS lifted annual revenue and profit forecasts above Wall Street estimates after reducing Amazon delivery volumes, targeting $3 billion in cost savings by 2026 despite investor skepticism.

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UPS Hikes Full-Year Forecasts After Amazon Delivery Reductions

UPS Hikes Full-Year Forecasts After Amazon Delivery Reductions

FAQ