Atlanta-based UPS increases U.S. volumes for first time since 2022, but profits, revenue fall – WABE

UPS increased U.S. volume for the first time since 2022 in its second quarter, but profit and revenue fell short of Wall Street expectations, partly because of heavy loading.

Shares fell more than 7% before the market opened Tuesday.

CEO Carol Tome said the parcel delivery company returned to U.S. volume growth in the quarter for the first time in nine quarters.

“This quarter was a significant turning point for our company,” Tome said in a prepared statement.

Total U.S. domestic parcel volume increased slightly in the quarter driven by improved ground deliveries.

For the three months ended June 30, United Parcel Service Inc. earned $1.41 billion, or $1.65 per share.

Excluding one-time costs, earnings per share were $1.79, well below the $1.98 per share expected by analysts surveyed by Zacks Investment Research.

UPS said the quarter included a charge of $120 million, or 14 cents per share, consisting of a one-time payment of $94 million to settle an international regulatory matter. The period also included transformation and other charges totaling $26 million.

Total operating expenses increased approximately 3% during the quarter, including a 2.7% increase in compensation and benefits expenses.

In September, the Teamsters voted to reach a tentative agreement with UPS, ending contentious labor negotiations that threatened to disrupt package deliveries for millions of businesses and households across the country. The contract included wage increases for full- and part-time union workers.

Quarterly revenue came in at $21.82 billion, below Wall Street’s estimate of $22.31 billion.

The Atlanta-based company now expects annual revenue of about $93 billion. Its previous forecast was for revenue of between $92 billion and $94.5 billion.

Analysts polled by FactSet expect revenue of $92.77 billion.