UPS surpasses profit expectations but announces 20,000 job cuts
United Parcel Service (UPS) reported a first-quarter profit that exceeded market expectations, driving its shares up more than 5% before the bell on Tuesday.
However, the parcel delivery giant also revealed plans to cut 20,000 jobs as it looks to streamline operations amid an uncertain economic climate, News.Az reports, citing CNBC.
Extensive tariffs by U.S. President Donald Trump have slowed down trade and led companies to reduce costs in anticipation of a demand hit. For parcel delivery firms, the slowdown is likely to reduce the need for shipping services between companies.
UPS said it was not providing any updates to its full-year outlook due to the economic uncertainty, even as it lowers costs through job cuts, warehouse closures, increased automation and asset sales.
The company last year said it cut its workforce by 12,000 jobs. UPS said on Tuesday it will shut 73 leased and owned buildings by the end of June. The company expects to save $3.5 billion from its initiatives in 2025.
Its first-quarter revenue fell marginally to $21.5 billion but beat Wall Street expectations of $21.05 billion, according to data compiled by LSEG.
Its U.S. domestic segment revenue grew 1.4% to $14.46 billion in the first quarter, driven by an increase in air cargo and improving revenue per piece, even as volumes declined.
The world’s largest package delivery firm had in January forecast full-year revenue of $89 billion and an operating margin of about 10.8%.
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