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UPS projections weak 2025 earnings as it pares Amazon exposure, shares fall

United Parcel Service on Thursday anticipated 2025 income below expectations as the parcel delivery huge works to lower direct exposure to its largest consumer, Amazon, and as other consumers go with more affordable, slower groundbased deliveries.

UPS' shares fell 5% before the bell after the company said it had reached a contract with Amazon-- without naming the firm however referring to it as its largest consumer-- to cut volumes it transports with UPS by more than 50% by the 2nd half of next year.

The move comes as Amazon has also been reducing its reliance on UPS as the e-commerce company continues to expand its own shipment network.

UPS forecast 2025 revenue of $89 billion, compared with the average expert price quote of $94.88 billion, according to data compiled by LSEG.

It likewise anticipate full-year revenue of $89 billion, compared with quotes of $94.88 billion.

UPS and competing FedEx have actually been cutting costs given that customers switched to slower, less expensive deliveries in the wake of the early pandemic's e-commerce boom.

Atlanta-based UPS also anticipated full-year combined running margin at 10.8%, a boost from the 9.8% it reported for 2024.

The business reported fourth-quarter profits of $25.3. billion, missing out on price quotes of $25.42 billion.

UPS reported an adjusted revenue of $2.75 per share for the. quarter ended Dec. 31, beating price quotes of $2.53 per share.

(source: Reuters)