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United Parcel Service or UPS will eliminate up to 30,000 jobs and shut another 24 facilities in 2026, the world's largest package delivery company said on Tuesday, as it reduces deliveries for Amazon in an ongoing shift toward more profitable business.
Shares of the company, which also announced fourth-quarter results that topped Wall Street estimates and forecast a surprise rise in annual revenue, rose 4% in midday trading. Shares of FedEx gained 2.6%.
UPS in January last year said it would accelerate a plan to slash millions of low-profit deliveries for the online retailer, its largest customer and a growing delivery rival, calling the business "extraordinarily dilutive" to margins. UPS and rivals like FedEx have been battling stubbornly soft demand for delivery services.
In 2025, UPS eliminated 48,000 jobs, launched driver buyouts and closed operations at 93 buildings as Amazon volume shrank. This year's job reductions will come via attrition and another buyout offer for full-time drivers. Layoffs are not planned, Chief Financial Officer Brian Dykes said.
UPS had about 490,000 employees, with nearly 78,000 in management, according to its 2024 annual report. Its 2025 employment numbers were not immediately available.
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UPS has a unionised workforce. The CFO said many of the cuts will come from not filling jobs when part-time workers leave the company.
Separately, the company is working to stabilise volumes following the end of US duty-free, "de minimis" low-value e-commerce shipments from major China-linked discount retailers like Shein and Temu.
The company projected 2026 revenue of $89.7 billion, compared to $88.7 billion in 2025. Analysts on average had expected revenue of almost $88 billion, according to data compiled by LSEG.
HOLIDAY QUARTER BEAT
The peak holiday shipping season, from late November into early January, is critical for parcel carriers as their average daily volumes can double, with companies often adding seasonal surcharges.
UPS reported fourth-quarter consolidated revenue of $24.5 billion, above estimates of $24 billion. On an adjusted basis, UPS reported a profit of $2.38 per share for the quarter ended December 31, above estimates of $2.20 per share.
Excluding Amazon, peak season volume was mixed, with small and medium-sized businesses a bit stronger than expected and large retailers a bit weaker, CFO Dykes told Reuters.
"We were down a little bit from last year," he said.
Revenue per piece in the company's US domestic segment rose 8.3% despite lower overall volume, while international revenue per piece increased 7.1%, benefiting from its push toward higher-margin shipments.
UPS also said it retired its remaining MD-11 fleet of more than two dozen cargo jets by the end of 2025, accelerating an existing plan. That followed a deadly crash of one of its MD-11s in November. Replacement Boeing 767s are already scheduled for delivery.
Shares of the company, which also announced fourth-quarter results that topped Wall Street estimates and forecast a surprise rise in annual revenue, rose 4% in midday trading. Shares of FedEx gained 2.6%.
UPS in January last year said it would accelerate a plan to slash millions of low-profit deliveries for the online retailer, its largest customer and a growing delivery rival, calling the business "extraordinarily dilutive" to margins. UPS and rivals like FedEx have been battling stubbornly soft demand for delivery services.
In 2025, UPS eliminated 48,000 jobs, launched driver buyouts and closed operations at 93 buildings as Amazon volume shrank. This year's job reductions will come via attrition and another buyout offer for full-time drivers. Layoffs are not planned, Chief Financial Officer Brian Dykes said.
UPS had about 490,000 employees, with nearly 78,000 in management, according to its 2024 annual report. Its 2025 employment numbers were not immediately available.
Also Read: TikTok settles social media addiction lawsuit ahead of trial against Meta, YouTube
UPS has a unionised workforce. The CFO said many of the cuts will come from not filling jobs when part-time workers leave the company.
Separately, the company is working to stabilise volumes following the end of US duty-free, "de minimis" low-value e-commerce shipments from major China-linked discount retailers like Shein and Temu.
The company projected 2026 revenue of $89.7 billion, compared to $88.7 billion in 2025. Analysts on average had expected revenue of almost $88 billion, according to data compiled by LSEG.
HOLIDAY QUARTER BEAT
The peak holiday shipping season, from late November into early January, is critical for parcel carriers as their average daily volumes can double, with companies often adding seasonal surcharges.
UPS reported fourth-quarter consolidated revenue of $24.5 billion, above estimates of $24 billion. On an adjusted basis, UPS reported a profit of $2.38 per share for the quarter ended December 31, above estimates of $2.20 per share.
Excluding Amazon, peak season volume was mixed, with small and medium-sized businesses a bit stronger than expected and large retailers a bit weaker, CFO Dykes told Reuters.
"We were down a little bit from last year," he said.
Revenue per piece in the company's US domestic segment rose 8.3% despite lower overall volume, while international revenue per piece increased 7.1%, benefiting from its push toward higher-margin shipments.
UPS also said it retired its remaining MD-11 fleet of more than two dozen cargo jets by the end of 2025, accelerating an existing plan. That followed a deadly crash of one of its MD-11s in November. Replacement Boeing 767s are already scheduled for delivery.
