UPS Beats Third-Quarter Estimates and Raises Its 2026 Outlook, With Shares Rising About 5%

UPS told investors on Tuesday that it expects to earn more this year than it thought three months ago, even as it ships fewer parcels in America. The delivery group beat third-quarter forecasts on revenue and profit and raised its full-year outlook, according to its results filing.

Revenue rose 6.7 percent to $22.9 billion and adjusted earnings per share were $1.69. Analysts had expected $1.63 and revenue of about $22.28 billion, Investing.com reported.

What did UPS raise its 2026 guidance to?

The company now expects revenue of about $92.6 billion, adjusted operating profit of about $8.75 billion, adjusted earnings of about $7.28 a share and capital spending of about $3.0 billion. For the fourth quarter it guides to revenue of about $25.7 billion and operating profit of about $3.3 billion. "Better is truly better than bigger," chief executive Carol Tomé said on the call, summing up a strategy of premium volume over package count.

How did UPS's businesses perform?

US Domestic revenue grew 4.5 percent to $14.87 billion on a 6.1 percent rise in revenue per piece, while average daily volume slipped to 15.6 million packages from 16.2 million a year earlier. Adjusted operating margin in that segment was 7.0 percent. International revenue rose 7.1 percent to $5.0 billion, with a 14.9 percent operating margin. Supply Chain Solutions revenue jumped 18.2 percent to about $3.0 billion, but a $182 million goodwill impairment hit the reported result, and Transport Topics says its operating profit fell 82.5 percent to $92 million. GAAP net income was $1.16 billion, or $1.37 a share, against $1.31 billion, or $1.55, a year earlier.

Why is UPS expecting lower volume this holiday season?

Tomé said fourth-quarter US average daily volume is expected to be lower than a year earlier, which she attributes to earlier actions to shed low-margin shipments. UPS completed its planned reduction of Amazon volume, which it calls the glide-down, on 28 July, Transport Topics says. The trade paper reports that holiday online retail is forecast to rise about 9 percent, and that about 100 US customers account for roughly 80 percent of UPS's peak surge, with their forecasts pointing to average daily volume rising 25 percent sequentially into the quarter. Tomé said UPS is ready for peak.

How did UPS and FedEx shares react?

The reaction built through the day. Early trading was nearly flat at about $100.41 against a prior close of $100.32, Investing.com noted. By the afternoon UPS was up about 5 percent at $105.01, and FedEx was up about 2 percent to $306.15 ahead of its own report later this week, according to 24/7 Wall St. via Yahoo Finance.

The quarter shows a company that has stopped chasing volume and is being paid for it. The test comes in the fourth quarter, when lower parcel counts have to be offset by price and mix at the busiest time of the year.