UPS upbeat after 'transitional' first quarter

28th Apr 2026 11:23

(Sharecast News) - UPS posted lower sales and profits on Tuesday while reiterating full-year guidance, following a "critical transition" during the first quarter.

The world's largest package delivery company saw revenues ease 1.6% to $21.2bn in the three months to March end, while adjusted net income was $1.07 per share. That was down on the $1.49 recorded a year previously, but ahead of the $1.02 expected by Wall Street.

Logistics companies such as Atlanta-based UPS have been hit by sweeping changes to trade policy, including the loss of the de minimis exception for low-value shipments, which was scrapped by Donald Trump last year. Fuel costs are also rising following the outbreak of war in the Middle East.

In response, UPS is looking to transition to higher-paying shipments as well as cutting costs. It is also focusing on more specialised industries, such as data centres and healthcare, while reducing its reliance on Amazon. The tech giant is UPS's biggest customer but its high volumes eat into profit margins.

Carol Tome, chief executive, said the first quarter had marked a "critical transition period for UPS, in which we needed to flawlessly execute several major strategic actions, and we delivered.

"With that behind us, we expect to return to consolidated revenue and operating profit growth, and adjusted operating margin expansion in the second quarter."

However, by 1345 BST the stock had shed 5% in pre-market trading. Analysts pointed to a disappointing first-quarter operating margin at the US domestic segment, UPS's biggest division by some distance. The margin came in at 4%, at the lower end of most forecasts.

Some were also disappointed that UPS declined to raise its full-year outlook. Instead it reaffirmed guidance for revenues of $89.7bn - compared to $88.7bn in 2025 - and an adjusted operating margin of around 9.6%.