United Parcel Service, Inc. (NYSE:UPS) reported fourth-quarter 2025 results on Tuesday, posting revenue of $24.5 billion and operating profit of $2.6 billion. Non-GAAP adjusted operating profit totaled $2.9 billion.
Shares were trading higher following the release as the company topped Wall Street expectations and issued full-year 2026 guidance.
Earnings And Key Items
Diluted GAAP earnings per share were $2.10, while non-GAAP adjusted diluted EPS was $2.38. The company said results “outperformed our financial expectations in the fourth quarter.”
United Parcel Service reported adjusted EPS of $2.38, beating the $2.20 estimate, while revenue of $24.500 billion topped the $24.003 billion estimate.
GAAP results for the quarter included total charges of $238 million, or 28 cents per diluted share. These included a $137 million after-tax non-cash charge related to the write-off of the MD-11 aircraft fleet and $101 million of after-tax transformation charges. UPS accelerated its fleet modernization plans, completing the retirement of its MD-11 fleet during the fourth quarter.
UPS declared a first-quarter 2026 dividend of $1.64 per share, payable March 5, 2026, to shareowners of record on February 17, 2026. The company also said it returned $6.4 billion to shareholders during 2025 through dividends and share repurchases.
Segment Performance
In U.S. Domestic, revenue totaled $16.756 billion, down from $17.312 billion a year earlier. UPS said revenue declined 3.2%, “primarily driven by an expected decline in volume,” while revenue per piece increased 8.3%. Operating margin was 8.5%, with a non-GAAP adjusted operating margin of 10.2%.
International revenue rose to $5.045 billion from $4.923 billion, driven by a 7.1% increase in revenue per piece. Operating margin was 17.5%, and non-GAAP adjusted operating margin was 18.0%.
Supply Chain Solutions revenue declined to $2.678 billion from $3.066 billion. UPS said revenue fell 12.7%, “primarily due to a decline in volume in the Mail Innovations business.” Operating margin was 9.8%, with a non-GAAP adjusted operating margin of 10.3%.
Full-Year Results
For full-year 2025, UPS reported revenue of $88.7 billion, operating profit of $7.9 billion, and non-GAAP adjusted operating profit of $8.7 billion. Operating margin was 8.9%, and non-GAAP adjusted operating margin was 9.8%.
GAAP diluted EPS totaled $6.56, while non-GAAP adjusted diluted EPS was $7.16. Cash from operations totaled $8.5 billion, and non-GAAP adjusted free cash flow was $5.5 billion.
CEO Carol Tomé said, “2025 was a year of considerable progress for UPS as we took action to strengthen our revenue quality and build a more agile network. Looking ahead, upon completion of the Amazon glide-down, 2026 will be an inflection point in the execution of our strategy to deliver growth and sustained margin expansion.”
In an October report, Brian Dykes, CFO of UPS, said UPS’s decision to cut its Amazon.com, Inc. (NASDAQ:AMZN) delivery volume by half by late 2026 signals a major strategic shift, reflecting a long-term divergence in priorities that led UPS to reassess where it creates the most value after nearly three decades of partnership.
Outlook
For 2026, UPS forecasts revenue of about $89.7 billion, above the $87.938 billion analyst estimate, and a non-GAAP adjusted operating margin of about 9.6%.
The company said it plans capital expenditures of about $3.0 billion and expects dividend payments of around $5.4 billion, subject to board approval, with an effective tax rate of approximately 23.0%.
In its forward-looking statements, UPS cited risks including “new or increased tariffs” and “increasingly stringent regulations related to climate change,” among other factors.
UPS Price Action: United Parcel Service shares were up 2.70% at $109.86 during premarket trading on Tuesday, according to Benzinga Pro data.
Photo by MikeDotta via Shutterstock
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