UPS Experiences More Than 10% Drop in Revenues During Q2 2023

Express giant UPS showed it’s not immune to the challenges of the current economic climate when it announced a second quarter drop in consolidated revenues of over 10% year on year.

UPS said its second-quarter 2023 consolidated revenues were $22.1bn, a 10.9% decrease from the second quarter of 2022.

Consolidated operating profit was $2.8bn, down 21.4% compared to the second quarter of 2022, and down 18.4% on an adjusted basis.

Revenue decreased 13% to $4,415bn within UPS’ international segment, primarily driven by a 6.6% reduction in average daily volume and continued softness on Asia trade lanes, said the company.

At the end of last month, UPS and the Teamsters union announced a tentative agreement over new pay and working conditions.

“We are pleased to have reached agreement with the Teamsters. I want to thank the more than 500,000 UPSers around the world for their hard work and efforts, and for once again providing industry-leading service. And a special thank you to our customers for trusting your business with UPS during our labor negotiations,” said Carol Tomé, UPS chief executive officer.

“UPS is stronger than ever. Looking ahead, we will stay on strategy to capture growth in the most attractive parts of the market and make our global integrated network even more efficient.”

Referring to the outlook for this year, the company stated: “UPS is updating its full-year 2023 consolidated revenue and adjusted operating margin targets primarily to reflect the volume impact from labor negotiations and the costs associated with the tentative agreement reached with the International Brotherhood of Teamsters on July 25, 2023. UPS now expects full-year 2023 consolidated revenue to be about $93 billion and an adjusted operating margin of around 11.8%.”