TLDR
- UPS projects 2026 revenue of $89.7 billion, surpassing analyst forecasts of $88.05 billion
- Fourth-quarter earnings per share of $2.38 (adjusted) beat expectations of $2.20
- Company finished retiring MD-11 aircraft fleet with $137 million write-off in Q4
- Workforce reduced by 48,000 positions and 93 facilities closed during restructuring
- Premarket trading saw shares surge 3.7% to $111.00 following earnings release
UPS reported stronger-than-expected fourth-quarter results and an upbeat 2026 outlook. The delivery company is benefiting from its strategic pivot away from low-margin Amazon business.
The shipper earned $1.79 billion, or $2.10 per share, in the fourth quarter. Last year’s comparable quarter brought in $1.72 billion, or $2.01 per share.
One-time charges totaling $238 million hit the quarter. The biggest item was a $137 million write-off for retiring the MD-11 aircraft fleet.
United Parcel Service, Inc., UPS
UPS wrapped up the MD-11 retirement during the quarter. A November crash involving a 34-year-old MD-11 cargo plane killed at least 12 people.
Adjusted earnings came in at $2.38 per share after removing one-time costs. Wall Street had penciled in $2.20 per share.
Revenue Dips But Beats Forecasts
Revenue dropped 3.2% to $24.48 billion from $25.3 billion last year. The number still topped analyst estimates of $24.01 billion.
The revenue slide reflects UPS’s intentional move to cut volumes from Amazon. The online retailer was previously the company’s biggest customer.
UPS slashed its workforce by roughly 48,000 jobs over the past year. Management positions accounted for about 14,000 of those cuts.
The company shuttered daily operations at 93 buildings. Increased automation has made it possible to run leaner.
2026 Guidance Tops Expectations
UPS expects 2026 revenue around $89.7 billion. Analysts had predicted $88.05 billion.
CEO Carol Tomé described 2026 as “an inflection point” following the Amazon transition. The company anticipates growth and expanding margins ahead.
The projected adjusted operating margin for 2026 stands at 9.6%. UPS plans to spend approximately $3 billion on capital expenditures.
Dividend payments should reach about $5.4 billion, pending board approval. Management will keep reviewing volume patterns to identify more facilities for closure.
Market Reaction
Shares climbed 3.7% to $111.00 in premarket trading Tuesday. Competitor FedEx gained roughly 1% during the same session.
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