UPS
IndustrialsUnited Parcel Service
Price Chart
Market Data
Financials
XBRL · SEC EDGAR2008–2025(18yr)| Metric | FY 2008 | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $51.5B | $45.3B | $49.5B | $53.1B | $54.1B | $55.4B | $58.2B | $58.4B | $60.9B | $65.9B | $71.9B | $74.1B | $84.6B | $97.3B | $100.3B | $91.0B | $91.1B | $88.7B | -2.6% |
| Operating Income | $5.4B | $3.8B | $5.9B | $6.1B | $1.3B | $7.0B | $5.0B | $7.7B | $5.5B | $7.5B | $7.0B | $7.8B | $7.7B | $12.8B | $13.1B | $9.1B | $8.5B | $7.9B | -7.1% |
| Operating Margin | 10.5% | 8.4% | 11.9% | 11.4% | 2.5% | 12.7% | 8.5% | 13.1% | 9.0% | 11.4% | 9.8% | 10.5% | 9.1% | 13.2% | 13.0% | 10.0% | 9.3% | 8.9% | -0.4pp |
| Net Income | $3.0B | $2.2B | $3.5B | $3.8B | $807.0M | $4.4B | $3.0B | $4.8B | $3.4B | $4.9B | $4.8B | $4.4B | $1.3B | $12.9B | $11.5B | $6.7B | $5.8B | $5.6B | -3.6% |
| Net Margin | 5.8% | 4.8% | 7.0% | 7.2% | 1.5% | 7.9% | 5.2% | 8.3% | 5.6% | 7.5% | 6.7% | 6.0% | 1.6% | 13.2% | 11.5% | 7.4% | 6.3% | 6.3% | -0.1pp |
| Free Cash Flow | $5.8B | $3.7B | $2.4B | $5.1B | $5.1B | $5.2B | $3.4B | $5.1B | $3.5B | -$3.7B | $6.4B | $2.3B | $5.0B | $10.8B | $9.3B | $5.1B | $6.2B | $4.8B | -23.3% |
| FCF Margin | 11.2% | 8.1% | 4.9% | 9.5% | 9.4% | 9.5% | 5.8% | 8.7% | 5.8% | -5.7% | 8.9% | 3.0% | 6.0% | 11.1% | 9.3% | 5.6% | 6.8% | 5.4% | -1.4pp |
| EPS (Diluted) | $2.94 | $2.14 | $3.48 | $3.84 | $0.83 | $4.61 | $3.28 | $5.35 | $3.87 | $5.61 | $5.51 | $5.11 | $1.54 | $14.68 | $13.20 | $7.80 | $6.75 | $6.56 | -2.8% |
1. THE BIG PICTURE
United Parcel Service is currently navigating a high-stakes divorce from its largest customer, Amazon, which accounted for 10.6% of 2025 revenue. Management is betting that by sacrificing this low-margin volume, it can retool its massive integrated network to serve specialized sectors like healthcare and small businesses, effectively trading scale for earnings quality.
2. WHERE THE RISKS HIT HARDEST
The "Global Smart Logistics Network," cited as a core competitive strength, is directly threatened by the strategic reduction of Amazon volume. If United Parcel Service cannot effectively eliminate the "stranded costs" associated with this infrastructure, the loss of volume will lead to margin compression rather than expansion (10-K Item 1A). Furthermore, United Parcel Service’s "distinctive culture" and reliance on professional drivers are vulnerable to its labor structure; with the Teamsters contract expiring in 2028, any threatened work stoppage could lead to permanent customer loss, undermining the "operational excellence" United Parcel Service uses to win healthcare and B2B contracts. Finally, the push into AI-driven "sensing" networks creates new cybersecurity vulnerabilities that could disrupt the very reliability that defines the brand.
3. WHAT THE NUMBERS SAY TOGETHER
While management points to "considerable progress," the financial data reveals a company in the midst of a structural contraction. Revenue fell 2.6% on a trailing-twelve-month basis, and the most recent quarter saw U.S. Domestic revenue decline by 3.2% due to expected volume losses (8-K). United Parcel Service currently operates with the lowest FCFFCFFree Cash Flow — cash left after paying for operations and capital investments; what the company can actually spend, save, or return to shareholders margin in its peer group at 3.3%, trailing significantly behind railroad peers like Union Pacific (24.9%) and its direct rival FedEx (4.2%). This cash flow tightness is notable when paired with a 6.6% dividend yield—the highest among peers—suggesting United Parcel Service is returning a high proportion of its cash to shareholders while its core segments, particularly Supply Chain Solutions (down 12.7%), face significant headwinds (8-K).
4. IS IT WORTH IT AT THIS PRICE?
At 12.7x Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations, United Parcel Service is the "cheapest" in its peer group, trading at a 36% discount to the peer median of 19.7x. This discount is justified by its negative revenue growth and a gross margin of 22.6% that ranks last among its peers (Yahoo Finance). At this price, the market is pricing in approximately 2.4% long-term growth (CAPM analysis). This is a low hurdle, especially considering that share buybacks contribute a 1.7% yield toward an implied EPSEPSEarnings Per Share — the company's net profit divided by its share count; the most common per-share profitability metric growth of 4.2%. However, United Parcel Service’s net debt of $18.5B against $2.9B in annual FCFFCFFree Cash Flow — cash left after paying for operations and capital investments; what the company can actually spend, save, or return to shareholders results in 6.5x net leverage, leaving little room for error if the 2026 "inflection point" fails to materialize. The current valuation is a reflection of the execution risk inherent in its "Efficiency Reimagined" strategy.
5. WHAT WOULD CHANGE THIS VIEW?
- Constructive if the 2026 non-GAAPGAAPGenerally Accepted Accounting Principles — the standard U.S. accounting rules all public companies must follow adjusted operating margin meets or exceeds the projected 9.6%, proving that the Amazon "glide-down" is successfully improving revenue quality (8-K).
- Cautious if the U.S. Domestic segment continues to see volume declines beyond the planned Amazon reductions, suggesting a loss of market share to regional or postal competitors.
- Cautious if FCFFCFFree Cash Flow — cash left after paying for operations and capital investments; what the company can actually spend, save, or return to shareholders margin fails to expand above 4%, which would raise questions about the long-term sustainability of the 6.6% dividend yield.
6. BOTTOM LINE
Structural Advantage: An integrated global air-and-ground network that leverages RFID "sensing" technology and a specialized healthcare cold chain to create high switching costs for B2B and medical shippers. Bottom Line: United Parcel Service is a high-yield transition story that remains a "show-me" stock until it proves it can grow profits while shrinking its largest customer relationship.
1. Top 5 Material Risks
- General Economic Uncertainty: United Parcel Service operates in over 200 countries, making its financial condition sensitive to industrial production, inflation, unemployment, and international trade policies.
- Competitive Pressures: United Parcel Service faces significant competition from postal services, motor carriers, and e-commerce companies that may offer pricing terms United Parcel Service is unwilling to match, potentially forcing volume losses or margin compression.
- Customer Concentration: The strategy to reduce volume from Amazon.com, Inc. (10.6% of 2025 consolidated revenues) requires precise alignment of assets and workforce; failure to control the resulting stranded costs could materially impact profitability.
- Labor Relations: With a national master agreement with the Teamsters expiring in 2028, actual or threatened work stoppages could lead to permanent customer loss and increased labor costs.
- Cybersecurity and AI Risks: Increased reliance on IT and artificial intelligence creates vulnerabilities to data breaches, ransomware, and operational disruptions that could lead to regulatory fines and litigation.
2. Company-Specific Risks
- Network Reconfiguration: The "Efficiency Reimagined" initiative involves facility and workforce consolidation; failure to retain experienced employees during this transition could reduce operational effectiveness.
- Asset Impairment: Changes in business plans and network adjustments led to $182 million in asset impairment charges in the fourth quarter of 2025, with potential for further charges if asset useful lives are revised.
- Climate Goal Execution: Achieving carbon neutrality by 2050 depends on technological advancements like sustainable aviation fuel (SAF); failure to meet these goals or prioritize other investments could result in adverse publicity and regulatory risk.
- Self-Insurance Exposure: United Parcel Service utilizes self-insurance for workers' compensation and general liabilities; an increase in the number or severity of claims could lead to significant, unpredictable charges against earnings.
3. Regulatory/Legal Risks
- Climate Regulation: The ReFuelEU Aviation initiative mandates increasing percentages of SAF (from 2% in 2025 to 70% by 2050), which may significantly increase operating costs as suppliers pass on the higher price of SAF.
- Data Protection Laws: Compliance with the EU’s General Data Protection Regulation, the California Privacy Rights Act, and other global data localization requirements imposes increasing compliance burdens and enforcement risks.
- International Trade Policy: United Parcel Service is subject to unpredictable tariff policies, export requirements, and embargoes that can restrict operations and increase the cost of compliance.
- CORSIA Compliance: Mandatory participation in the Carbon Offsetting and Reduction Scheme for International Aviation beginning in 2027 may significantly increase operating costs.
4. Financial Impact Map
General Economic Uncertainty → Consolidated Revenues → Exposure to global industrial production and retail activity levels. Competitive Pressures → Operating Profit → Potential for margin compression if pricing terms are not accepted by customers. Customer Concentration (Amazon.com, Inc.) → Consolidated Revenues → 10.6% of 2025 revenues derived from this single customer. Labor Relations → Operating Expenses → Potential for increased labor costs and reduced revenues due to service interruptions. Asset Impairment → Net Income → $182 million in charges recorded in Q4 2025; future revisions to asset useful lives could further reduce net income.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 10-K | Feb 2026 | Dec 2025 |
| 8-K | Jan 2026 | — |
| 10-Q | Nov 2025 | Sep 2025 |
| 14A | Mar 2025 | — |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
UPS Fair Value Estimate Steady at $113.15 Amid Mixed Analyst Price Target Revisions
- ▸Fair value estimate remains steady at $113.15
- ▸Jefferies raised price target to $135 from $130
- ▸BofA cut price target to $112 from $118 citing Q1 earnings pressure
- ▸Reaffirmed 2026 consolidated revenue target of approximately $89.7B
- ▸Amazon shifting over 1 billion annual package deliveries to USPS
UPS Q1 Revenue $21.2B, Net Income $864M; Reaffirms FY26 Revenue Guidance $89.7B
- ▸Q1 revenue $21.2B, net income $864M
- ▸Reaffirmed FY26 revenue guidance of approximately $89.7B
- ▸Expanded Happy Returns 'Return Bar' network to 10,000 locations
- ▸Strategic shift toward higher-margin SMB and retail volume away from Amazon
- ▸Long-term 2029 projections target $97.9B revenue and $7.1B earnings
UPS Opens $100M Taoyuan International Logistics Center to Expand Asia Pacific Capacity
- ▸Invested $100M in new Taoyuan International Logistics Center (TILC)
- ▸TILC facility spans over 81,000 square meters of floorspace
- ▸Facility doubles UPS warehouse footprint in Taiwan
- ▸Applied Materials utilizes TILC as Asia continental distribution center
- ▸Features autonomous mobile robots for inventory and packing automation
UPS opens $100M Taiwan logistics hub to boost Asia-Pacific capacity
- ▸Invested $100M in 872,000-square-foot automated Taiwan distribution center
- ▸Facility doubles UPS warehouse footprint in Taiwan
- ▸Order processing speed increased by 40% via autonomous mobile robots
- ▸Supports high-margin B2B sectors including semiconductors and medical technology
- ▸Applied Materials utilizing facility as Asia continental distribution center
UPS withdraws Central Region driver buyout program following Teamsters union grievances
- ▸UPS withdrew Central Region driver buyout scheme after 37 Teamsters grievances
- ▸Union demanding nationwide dismantling of Driver Choice Program
- ▸Labor friction threatens 'Network of the Future' cost-saving initiatives
- ▸Company targeting $3.5 billion in annual cost savings via network reconfiguration
- ▸Projected 2028 revenue $94.5 billion and earnings $7.1 billion
UPS opens $100M Taiwan logistics hub to support regional semiconductor tech demand
- ▸Opened $100M logistics center in Taoyuan, Taiwan
- ▸Facility serves as largest UPS hub in Asia Pacific
- ▸80% of freight volume consists of high-tech goods
- ▸Applied Materials confirmed as anchor user for Asian distribution
- ▸Considering future expansion to Kaohsiung to support TSMC manufacturing cluster
UPS to shed $5B in Amazon revenue to improve operating margins
- ▸Reducing Amazon business by over 50% by late 2024
- ▸Annual revenue impact estimated at $5 billion reduction
- ▸Eliminating 30,000 jobs this year following 48,000 cuts last year
- ▸Targeting margin expansion to offset top-line revenue decline
- ▸Historical profit margins currently range between 6% and 7%
UPS Q4 revenue $24.48B, down 3.2% YoY, beats analyst estimates by 1.8%
- ▸UPS Q4 revenue $24.48B, down 3.2% YoY, beat estimates by 1.8%
- ▸UPS stock down 8.9% since earnings report, currently trading at $97.42
- ▸FedEx Q4 revenue $23.47B, up 6.8% YoY, beat estimates by 3%
- ▸FedEx stock up 22.6% since earnings report, currently trading at $351.97
- ▸Air freight and logistics sector Q4 revenues beat consensus estimates by 0.7%
UPS shares decline 18% in month as Amazon volume reduction strategy nears completion
- ▸UPS shares down 18.48% over past month to approximately $97
- ▸Company deliberately shrinking revenue base to prioritize higher-margin customers
- ▸Strategic shift involves reducing reliance on Amazon delivery volumes
- ▸Stock previously traded at $116.63 following January earnings report
- ▸Volume reduction strategy entering final phase of implementation
FedEx market cap surpasses UPS for first time as UPS shares slide 11%
- ▸FedEx market cap reaches $84.6B, exceeding UPS at $74.75B
- ▸UPS Q4 2025 domestic package volume -10.8% YoY
- ▸UPS full-year 2025 revenue $88.66B, down 2.46% YoY
- ▸UPS Q4 2025 operating income -13.76% YoY to $2.575B
- ▸UPS dividend payout of $5.4B nearly equals 2025 free cash flow of $5.47B