UPS stuns Wall Street with strong profit and 34,000 job cuts
The company has closed daily operations at 93 leased and owned buildings in 2025
[NEW YORK] United Parcel Service (UPS) smashed Wall Street’s third-quarter profit expectations, sending its shares soaring and fuelling confidence in the courier’s comeback plans.
The company also disclosed that it has cut 34,000 jobs this year in its operational workforce – a group that includes drivers and package handlers – a 70 per cent increase from its previous target.
As part of the sweeping cost-savings initiative, UPS has closed daily operations at 93 leased and owned buildings in 2025, according to a statement on Tuesday (Oct 28).
The results suggest chief executive officer Carol Tomé’s revival efforts are gaining traction after UPS struggled with slow demand, high expenses and uncertainty fuelled by tariffs. The parcel industry has faced significant challenges this year due to disruptions to international commerce under US President Donald Trump’s trade policies.
Adjusted earnings for UPS were US$1.74 a share last quarter, the company said. That beat the US$1.32 average of analyst estimates compiled by Bloomberg. Revenue also outpaced expectations.
“This is exactly what UPS needed,” said Matt Maley, chief market strategist at Miller Tabak. After the shares performed poorly for several years, signs of a possible turnaround are “something that should finally reverse the stock’s momentum.”
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The shares jumped 12 per cent as of 6.50 am before regular trading in New York, giving a lift to rival FedEx as well. UPS had tumbled 29 per cent this year through Monday.
Both package-delivery giants have endured a hit to their most profitable trade route, the lane between China and the US, in the volatile trade environment this year. FedEx said in September that it anticipates a US$1 billion headwind this year from the tumult.
UPS said on Tuesday it expects fourth-quarter revenue of about US$24 billion, slightly ahead of expectations.
The company is seeking to remove less-profitable business from its network, such as low-value e-commerce goods from online retail giant Amazon.com, while also closing and consolidating facilities to make way for more labour-saving automation.
UPS is simultaneously grappling with high costs in its hourly workforce, thanks in part to a hefty labour contract between the company and 330,000 members of the International Brotherhood of Teamsters.
The cost-reduction plan, including the job cuts already carried out, have generated savings of about US$2.2 billion through the first nine months of this year, UPS said. It expect to achieve US$3.5 billion total year-over-year cost savings in 2025.
The quarterly results were “impressive,” but one good report “may not be enough to turn the massive ship around,” said Mark Malek, chief investment officer at Siebert Financial.
“The company has been clearly struggling with growth, even prior to this tariff regime. Pressure from competition and emergence of AI to optimise supply chains is mounting.” BLOOMBERG
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