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UPS aims to cut approximately 20,000 jobs and close more than 70 facilities. This is to significantly reduce the amount of shipments from Amazon that we handle.
The package delivery company said Tuesday that it hopes to cut jobs this year. It is expected that 73 leasing and owned buildings will be closed by the end of June. The UPS said it is still reviewing the network and could potentially identify more buildings.
“The actions we are taking to restructure our network and reduce the costs of our overall business cannot be timely,” CEO Carol Tome said in a statement Tuesday. “The macro environment may be uncertain, but as we do, we are showing up as stronger and more agile ups.”
For three months, UPS announced that it had reached a deal with Amazon to cut its 50% or more by the second half of 2026.
During UPS’ fourth quarter revenue conference call in January, Tome said the company had been partnering with Amazon for nearly 30 years and when the contract went up this year, UPS decided to reevaluate the relationship.
“Amazon is our biggest customer, but not our most profitable customer,” Tomé said at the time. “That margin is extremely tenuous for our domestic US business.”
Tomé said UPS has looked at various options and decided that reduced volume was the best alternative.
According to FactSet, the company employs around 490,000 workers.
United Parcel Service Inc. reported its first quarter financial results on Tuesday. The Atlanta-based company won $1.19 billion, or $1.40 per share, in the quarter that ended March 31.
When certain items were removed, the revenue was $1.49 per share. This is better than the $1.44 per share voted analysts voted in by Zacks Investment Research.
The revenue totaled $21.55 billion, with Wall Street’s estimate of $21.06 billion.
UPS said it has not provided updates to its previously released full-year outlook given current macroeconomic uncertainty. The company previously said it expects revenue to be around $89 billion in 2025.
UPS shares rose slightly in the morning trading.
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