UPS (NYSE: UPS) Q1 2026 earnings drop but full-year outlook held
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
United Parcel Service, Inc. reported first-quarter 2026 revenue of $21.2 billion, with operating profit of $1.27 billion and diluted EPS of $1.02. Non-GAAP adjusted operating profit was $1.32 billion and non-GAAP adjusted diluted EPS was $1.07, excluding $42 million of after-tax transformation charges.
U.S. Domestic revenue was $14.1 billion, down 2.3% as expected volume declines were partially offset by 6.5% revenue-per-piece growth, yielding a 3.6% operating margin (4.0% non-GAAP adjusted. International revenue rose to $4.54 billion, up 3.8%, with a 12.0% operating margin (12.1% non-GAAP adjusted. Supply Chain Solutions revenue was $2.54 billion, down 6.5%, while operating profit increased to $205 million, for an 8.1% margin.
UPS reaffirmed full-year 2026 targets for consolidated revenue of approximately $89.7 billion and non-GAAP adjusted operating margin of about 9.6%. The company continues a multi-year transformation strategy, achieving roughly $600 million of cost savings in the first three months of 2026 and targeting about $3.0 billion of year-over-year savings in 2026, alongside expected capital expenditures of about $3.0 billion and dividend payments around $5.4 billion, subject to board approval.
Positive
- None.
Negative
- None.
Insights
UPS posts softer Q1 profits but maintains its full-year 2026 outlook.
UPS delivered Q1 2026 revenue of $21.2B with operating profit of $1.27B and GAAP EPS of $1.02. Profitability was below the prior year even after adjusting for items, as non-GAAP operating margin declined to 6.2% from 8.2%.
Segment trends were mixed. U.S. Domestic revenue fell 2.3% on lower volume, partly offset by 6.5% revenue-per-piece growth, compressing margin to 3.6%. International revenue grew 3.8% with a still-strong 12.0% margin, while Supply Chain Solutions saw revenue down 6.5% but operating profit rise sharply to $205M and margin of 8.1%.
The transformation program is central to the story. Management cites approximately $600M of cost savings in the first three months of 2026 and targets about $3B of year-over-year savings this year, offset by $1.3–$1.5B in related costs. Reaffirmed 2026 guidance for ~$89.7B revenue and ~9.6% non-GAAP operating margin signals confidence that efficiency gains and network reconfiguration can support margin recovery as the year progresses.
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Q1 2026 Revenue: $21.2B
Q1 2026 Operating Profit (GAAP): $1.27B
Q1 2026 Diluted EPS (GAAP): $1.02
+5 more
8 metrics
Q1 2026 Revenue
$21.2B
Consolidated first-quarter 2026 revenue
Q1 2026 Operating Profit (GAAP)
$1.27B
Consolidated operating profit, first quarter 2026
Q1 2026 Diluted EPS (GAAP)
$1.02
Diluted earnings per share for Q1 2026
Q1 2026 Adjusted Diluted EPS
$1.07
Non-GAAP adjusted diluted EPS excluding transformation charges
2026 Revenue Target
$89.7B
Approximate full-year 2026 consolidated revenue guidance
2026 Adjusted Operating Margin Target
9.6%
Approximate full-year 2026 non-GAAP operating margin guidance
Q1 2026 Free Cash Flow
$1.28B
Non-GAAP free cash flow for the quarter
Q1 2026 Transformation Savings
$600M
Program cost savings in first three months of 2026
Key Terms
Non-GAAP adjusted, Free Cash Flow, Transformation Strategy Costs, Network Reconfiguration and Efficiency Reimagined, +2 more
6 terms
Non-GAAP adjusted financial
"Non-GAAP Adjusted Consolidated Operating Margin of 6.2%"
Non-GAAP adjusted describes financial measures that companies report after removing or changing certain items that appear in standard accounting statements. Think of it as a company showing a cleaned-up score by taking out one-time events, unusual charges, or accounting quirks so investors can see what management considers the business’s steady performance; it matters because these figures can highlight underlying trends but may omit real costs, so investors should compare them with the official GAAP numbers.
Free Cash Flow financial
"Free Cash Flow (Non-GAAP measure) | $ | 1,280 | | $ | 1,487"
Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.
Transformation Strategy Costs financial
"Transformation Strategy Costs: Transformation 2.0, Fit to Serve, Network Reconfiguration and Efficiency Reimagined"
Network Reconfiguration and Efficiency Reimagined financial
"Network Reconfiguration and Efficiency Reimagined | 55 | | 23"
Driver Choice Program financial
"of which $1.2 billion will be related to the Driver Choice Program"
Operating margin financial
"Operating margin was 3.6%; non-GAAP adjusted operating margin was 4.0%."
Operating margin shows how much profit a company makes from its core business activities after paying for costs like wages and materials. It’s useful because it tells you how efficiently a company is running—higher margins mean it keeps more money from each dollar of sales, which can indicate better management or stronger products.
Earnings Snapshot
Revenue: $21.2B · Guidance included
Q1 2026
Revenue
$21.2B
Operating Profit (GAAP)
$1.27B
Operating Margin (GAAP)
6.0%
Diluted EPS (GAAP)
$1.02
Adjusted Diluted EPS
$1.07
Guidance
UPS reaffirmed full-year 2026 targets of approximately $89.7B consolidated revenue and about 9.6% non-GAAP adjusted operating margin.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 28, 2026
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code (404 ) 828-6000
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol | Name of Each Exchange on Which Registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company. ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 — Results of Operations and Financial Condition.
On April 28, 2026 , United Parcel Service, Inc. (the “Company”) issued a press release containing information about the Company’s results of operations and financial condition for the quarter ended March 31, 2026. The Company also posted on its website at www.investors.ups.com financial statement schedules containing additional detail about the Company's results of operations and financial condition for the same period.
A copy of the press release is attached hereto as Exhibit 99.1. A copy of the financial statement schedules is attached hereto as Exhibit 99.2.
Item 9.01 — Financial Statements and Exhibits.
(d) Exhibits
99.1 Press release dated April 28, 2026
99.2 Financial statement schedules
104 The cover page from this Current Report on Form 8-K, formatted in Inline XBRL
The information contained in Items 2.02 and 9.01 shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filings under the Securities Act of 1933 or the Exchange Act, except as may be expressly set forth by reference in any such filing.
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| UNITED PARCEL SERVICE, INC. | |||||||||||||||||||||||
| Date: | By: | /s/ BRIAN DYKES | |||||||||||||||||||||
| Brian Dykes | |||||||||||||||||||||||
| Executive Vice President and Chief Financial Officer | |||||||||||||||||||||||
Exhibit 99.1
UPS RELEASES 1Q 2026 EARNINGS
•Consolidated Revenues of $21.2B
•Consolidated Operating Margin of 6.0%; Non-GAAP Adjusted* Consolidated Operating Margin of 6.2%
•Diluted EPS of $1.02; Non-GAAP Adj. Diluted EPS of $1.07
•Reaffirms Full Year 2026 Guidance
ATLANTA – April 28, 2026 – UPS (NYSE:UPS) today announced first-quarter 2026 consolidated revenues of $21.2 billion. Consolidated operating profit was $1.27 billion; non-GAAP adjusted consolidated operating profit was $1.32 billion. Diluted earnings per share were $1.02 for the quarter; non-GAAP adjusted diluted earnings per share were $1.07.
For the first quarter of 2026, GAAP results included after-tax transformation charges of $42 million, or $0.05 per diluted share.
“I want to thank UPSers around the world for their hard work and efforts, and for pushing our transformation forward,” said Carol Tomé, UPS chief executive officer. “The first quarter of 2026 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 of this year.”
U.S. Domestic Segment
1Q 2026 | Non-GAAP Adjusted 1Q 2026 | 1Q 2025 | Non-GAAP Adjusted 1Q 2025 | |||||||||||
Revenue | $14,125 M | $14,460 M | ||||||||||||
Operating profit | $515 M | $565 M | $979 M | $1,011 M | ||||||||||
•Revenue declined 2.3%, primarily driven by an expected decline in volume. Revenue per piece grew by 6.5%.
•Operating margin was 3.6%; non-GAAP adjusted operating margin was 4.0%.
International Segment
1Q 2026 | Non-GAAP Adjusted 1Q 2026 | 1Q 2025 | Non-GAAP Adjusted 1Q 2025 | |||||||||||
Revenue | $4,540 M | $4,373 M | ||||||||||||
Operating profit | $547 M | $551 M | $641 M | $654 M | ||||||||||
•Revenue increased 3.8%, driven by a 10.7% increase in revenue per piece.
•Operating margin was 12.0%; non-GAAP adjusted operating margin was 12.1%.
Supply Chain Solutions1
1Q 2026 | Non-GAAP Adjusted 1Q 2026 | 1Q 2025 | Non-GAAP Adjusted 1Q 2025 | |||||||||||
Revenue | $2,537 M | $2,713 M | ||||||||||||
Operating profit | $205 M | $206 M | $46 M | $98 M | ||||||||||
1 Consists of operating segments that do not meet the criteria of a reportable segment under ASC Topic 280 – Segment Reporting.
•Revenue declined 6.5%, primarily due to a decline in volume in the Mail Innovations business.
•Operating margin was 8.1%; non-GAAP adjusted operating margin was 8.1%.
2026 Outlook
The company provides certain guidance on a non-GAAP adjusted basis because it is not possible to predict or provide a reconciliation reflecting the impact of various potential future events, including the impact of pension adjustments, certain strategic initiatives or other unanticipated events, which would be included in reported (GAAP) results and could be material.
For the full year 2026, the company reaffirms its consolidated financial targets of revenue of approximately $89.7 billion and non-GAAP adjusted operating margin of approximately 9.6%.
The company also confirms expected capital expenditures of about $3.0 billion and dividend payments of around $5.4 billion, subject to board approval. The effective tax rate is still expected to be approximately 23.0%.
* “Non-GAAP Adjusted” or “Non-GAAP Adj.” amounts are non-GAAP adjusted financial measures. See the appendix to this release for a discussion of non-GAAP adjusted financial measures, including a reconciliation to the most closely correlated GAAP measure.
Contacts:
UPS Media Relations: 404-828-7123 or pr@ups.com
UPS Investor Relations: 404-828-6059 (option 4) or investor@ups.com
# # #
Conference Call Information
UPS CEO Carol Tomé and CFO Brian Dykes will discuss first-quarter results with investors and analysts during a conference call at 8:30 a.m. ET, April 28, 2026. That call will be open to others through a live Webcast. To access the call, go to the UPS Investor Relations page and click on “Earnings Conference Call.” Additional financial information is included in the detailed financial schedules being posted on www.investors.ups.com under “Quarterly Earnings and Financials” and as furnished to the SEC as an exhibit to our Current Report on Form 8-K.
About UPS
UPS (NYSE: UPS) is one of the world’s largest companies, with 2025 revenue of $88.7 billion, and provides a broad range of integrated logistics solutions for customers in more than 200 countries and territories. Focused on its purpose statement, “Moving our world forward by delivering what matters,” the company’s approximately 460,000 employees embrace a strategy that is simply stated and powerfully executed: Customer First. People Led. Innovation Driven. UPS is committed to reducing its impact on the environment and supporting the communities we serve around the world. More information can be found at www.ups.com, about.ups.com and www.investors.ups.com.
Forward-Looking Statements
This release, our Annual Report on Form 10-K for the year ended December 31, 2025 and our other filings with the Securities and Exchange Commission contain and in the future may contain “forward-looking statements”. Statements other than those of current or historical fact, and all statements accompanied by terms such as “will,” “believe,” “project,” “expect,” “estimate,” “assume,” “intend,” “anticipate,” “target,” “plan,” and similar terms, are intended to be forward-looking statements.
From time to time, we also include written or oral forward-looking statements in other publicly disclosed materials. Forward-looking statements may relate to our intent, belief, forecasts of, or current expectations about our strategic direction, prospects, future results, or future events; they do not relate strictly to historical or current facts. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any forward-looking statements because such statements speak only as of the date when made and the future, by its very nature, cannot be predicted with certainty.
Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or anticipated results. These risks and uncertainties include, but are not limited to: changes in general economic conditions in the U.S. or internationally, including as a result of changes in the global trade policy, new or increased tariffs, government shutdowns, or geopolitical uncertainty, tensions and/or conflicts in or arising from various countries and regions, including the European Union, Ukraine, the Russian Federation, the Middle East and the Trans-Pacific region; significant competition on a local, regional, national and international basis; changes in our relationships with our significant customers; our ability to attract and retain qualified employees; strikes, work stoppages or slowdowns by our employees; increased or more complex physical or operational security requirements; a significant cybersecurity incident, or increased data protection regulations; our ability to maintain our brand image and corporate reputation; impacts from global climate change; interruptions in or impacts on our business from natural or man-made events or disasters including terrorist attacks, epidemics or pandemics; exposure to changing economic, political, regulatory and social developments in international and emerging markets; our ability to realize the anticipated benefits from acquisitions, dispositions, joint ventures or strategic alliances; the effects of changing prices of energy, including gasoline, diesel, jet fuel, other fuels and interruptions in supplies of these commodities; changes in exchange rates or interest rates; our ability to accurately forecast our future capital investment needs; increases in our expenses or funding obligations relating to employee health, retiree health and/or pension benefits; our ability to manage insurance and claims expenses; changes in business strategy, government regulations or economic or
market conditions that may result in impairments of our assets; potential additional U.S. or international tax liabilities; increasingly stringent regulations related to climate change; potential claims or litigation related to labor and employment, personal injury, property damage, business practices, environmental liability and other matters; and other risks discussed in our filings with the Securities and Exchange Commission from time to time, including our Annual Report on Form 10-K for the year ended December 31, 2025, and subsequently filed reports. You should consider the limitations on, and risks associated with, forward-looking statements and not unduly rely on the accuracy of predictions contained in such forward-looking statements. We do not undertake any obligation to update forward-looking statements to reflect events, circumstances, changes in expectations, or the occurrence of unanticipated events after the date of those statements, except as required by law.
The Company routinely posts important information, including news releases, announcements, materials provided or displayed at analyst or investor conferences, and other statements about its business and results of operations, that may be deemed material to investors on the Company’s Investors Relations website at www.investors.ups.com. The Company uses its website as a means of disclosing material, nonpublic information and for complying with the Company’s disclosure obligations under Regulation FD. Investors should monitor the Company’s Investor Relations website in addition to following the Company’s press releases, filings with the SEC, public conference calls and webcasts. We do not incorporate the contents of any website into this or any other report we file with the SEC.
Reconciliation of GAAP and Non-GAAP Adjusted Financial Measures
We supplement the reporting of our financial information determined under generally accepted accounting principles ("GAAP") with certain non-GAAP adjusted financial measures. Management views and evaluates business performance on both a GAAP basis and by excluding costs and benefits associated with these non-GAAP adjusted financial measures. As a result, we believe the presentation of these non-GAAP adjusted financial measures better enables users of our financial information to view and evaluate underlying business performance from the same perspective as management.
Non-GAAP adjusted financial measures should be considered in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP. Our non-GAAP adjusted financial measures do not represent a comprehensive basis of accounting and therefore may not be comparable to similarly titled measures reported by other companies.
Forward-Looking Non-GAAP Adjusted Financial Measures
From time to time when presenting forward-looking non-GAAP adjusted financial measures, we are unable to provide quantitative reconciliations to the most closely correlated GAAP measure due to the uncertainty in the timing, amount or nature of any adjustments, which could be material in any period.
Transformation Strategy Costs
We exclude the impact of charges related to activities within our transformation strategy. Our transformation strategy activities have spanned several years and are designed to fundamentally change the spans and layers of our organization structure, processes, technologies and the composition of our business portfolio. Our transformation strategy has included initiatives within our Transformation 2.0, Fit to Serve and Network Reconfiguration and Efficiency Reimagined programs.
Various circumstances precipitated these initiatives, including identification and prioritization of certain investments, developments and changes in competitive landscapes, inflationary pressures, consumer behaviors, and other factors including post-COVID normalization and volume diversions attributed to our 2023 labor negotiations.
Our transformation strategy includes the following programs and initiatives:
Transformation 2.0: We reduced spans and layers of management, reviewed and refined our business portfolio and invested in certain technologies to reduce costs, increase visibility and reduce reliance on legacy systems. Costs associated with Transformation 2.0 consisted primarily of compensation and benefit costs related to reductions in our workforce and fees paid to third-party consultants. This initiative was completed in 2025.
Fit to Serve: We undertook our Fit to Serve initiative to right-size our business to create a more efficient operating model that was more responsive to market dynamics through a workforce reduction, primarily within management. The initiative was completed in 2025.
Network Reconfiguration and Efficiency Reimagined: Our Network of the Future initiative is intended to enhance the efficiency of our network through automation and operational sort consolidation in our U.S. Domestic Package network. In connection with our strategic execution of planned volume declines from our largest customer, we began our Network Reconfiguration initiative, which is an expansion of Network of the Future, and has led, and could continue to lead, to further reductions in our facilities, vehicles, aircraft and workforce, as well as an end-to-end process redesign. We launched our Efficiency Reimagined initiatives to undertake the end-to-end process redesign effort which will align our organizational processes to the network reconfiguration.
Through these initiatives we have reduced our operational workforce and closed certain daily operations at leased and owned buildings. We continue to review expected changes in volume in our integrated air and ground network to identify additional workforce reductions and buildings for closure. In the first three months of 2026, we achieved approximately $600 million of program cost savings, and expect to achieve approximately $3 billion in full year-over-year cost savings from this initiative in 2026.
In connection with these Network Reconfiguration and Efficiency Reimagined programs, we expect non-GAAP adjusted operating expense to exclude between $1.3 and $1.5 billion in cost during 2026, primarily related to employee separation benefits and third-party consulting fees of which $1.2 billion will be related to the Driver Choice Program. As of March 31, 2026 we had incurred program costs to date of $599 million, including $55 million in 2026. These initiatives are expected to conclude by 2027.
We do not consider the related costs to be ordinary because each program involves separate and distinct activities that may span multiple periods and are not expected to drive incremental revenue, and because the scope of the programs exceeds that of routine, ongoing efforts to enhance profitability. These initiatives are in addition to ordinary, ongoing efforts to enhance our business performance.
Goodwill and Asset Impairments
We exclude the impact of goodwill and certain asset impairment charges. We do not consider these charges when evaluating the operating performance of our business units, making decisions to allocate resources or in determining incentive compensation awards.
Reversal of Income Tax Valuation Allowance
We previously recorded non-GAAP adjustments for transactions that resulted in capital loss deferred tax assets not expected to be realized. As a result of property sales during 2025, these capital losses were fully realized within the 2025 financial reporting period. We supplement our presentation with non-GAAP adjusted financial measures that exclude the impact of the reversals of the valuation allowances against these deferred tax assets as we believe such treatment is consistent with how the valuation allowance was initially established.
Non-GAAP Adjusted Cost per Piece
We evaluate the efficiency of our operations using various metrics, including non-GAAP adjusted cost per piece. Non-GAAP adjusted cost per piece is calculated as non-GAAP adjusted operating expenses in a period divided by total volume for that period. Because non-GAAP adjusted operating expenses exclude costs or charges that we do not consider a part of underlying business performance when monitoring and evaluating the operating performance of our business units, making decisions to allocate resources or in determining incentive compensation awards, we believe this is the appropriate metric on which to base reviews and evaluations of the efficiency of our operational performance.
Free Cash Flow
We calculate free cash flow as cash flows from operating activities less capital expenditures, proceeds from disposals of property, plant and equipment, and plus or minus the net changes in other investing activities. We believe free cash flow is an important indicator of how much cash is generated by our ongoing business operations and we use this as a measure of incremental cash available to invest in our business, meet our debt obligations and return cash to shareowners.
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures
(unaudited)
| Three Months Ended | ||||||||||||||||||||||||||
| March 31, | ||||||||||||||||||||||||||
| (amounts in millions) | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Operating Profit (GAAP) | $ | 1,267 | $ | 1,666 | Operating Margin (GAAP) | 6.0 | % | 7.7 | % | |||||||||||||||||
| Transformation Strategy Costs: | Transformation Strategy Costs: | |||||||||||||||||||||||||
| Transformation 2.0 | — | 16 | Transformation 2.0 | — | % | 0.1 | % | |||||||||||||||||||
| Fit to Serve | — | 19 | Fit to Serve | — | % | 0.1 | % | |||||||||||||||||||
| Network Reconfiguration and Efficiency Reimagined | 55 | 23 | Network Reconfiguration and Efficiency Reimagined | 0.2 | % | 0.1 | % | |||||||||||||||||||
| Total Transformation Strategy Costs | 55 | 58 | Total Transformation Strategy Costs | 0.2 | % | 0.3 | % | |||||||||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 39 | Goodwill and Asset Impairment Charges (1) | — | % | 0.2 | % | |||||||||||||||||||
| Non-GAAP Adjusted Operating Profit | $ | 1,322 | $ | 1,763 | Non-GAAP Adjusted Operating Margin | 6.2 | % | 8.2 | % | |||||||||||||||||
(1) Reflects impairment charges for long-lived assets for a business within Supply Chain Solutions in 2025. | ||||||||||||||||||||||||||
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures
(unaudited)
| Three Months Ended | ||||||||||||||||||||||||||
| March 31, | ||||||||||||||||||||||||||
| (amounts in millions) | 2026 | 2025 | (amounts in millions) | 2026 | 2025 | |||||||||||||||||||||
| Other Income (Expense) (GAAP) | $ | (143) | $ | (143) | Income Before Income Taxes (GAAP) | $ | 1,124 | $ | 1,523 | |||||||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 19 | Transformation Strategy Costs: | |||||||||||||||||||||||
| Transformation 2.0 | — | 16 | ||||||||||||||||||||||||
| Non-GAAP Adjusted Other Income (Expense) | $ | (143) | $ | (124) | ||||||||||||||||||||||
| Fit to Serve | — | 19 | ||||||||||||||||||||||||
| Network Reconfiguration and Efficiency Reimagined | 55 | 23 | ||||||||||||||||||||||||
| Total Transformation Strategy Costs | 55 | 58 | ||||||||||||||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 58 | ||||||||||||||||||||||||
| Non-GAAP Adjusted Income Before Income Taxes | $ | 1,179 | $ | 1,639 | ||||||||||||||||||||||
(1) Reflects impairment charges for long-lived assets for a business within Supply Chain Solutions as well the write-down of an equity method investment in 2025. | ||||||||||||||||||||||||||
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures
(unaudited)
| Three Months Ended | ||||||||||||||
| March 31, | ||||||||||||||
| (amounts in millions) | 2026 | 2025 | ||||||||||||
| Income Tax Expense (GAAP) | $ | 260 | $ | 336 | ||||||||||
| Transformation Strategy Costs: | ||||||||||||||
| Transformation 2.0 | — | 4 | ||||||||||||
| Fit to Serve | — | 4 | ||||||||||||
| Network Reconfiguration and Efficiency Reimagined | 13 | 6 | ||||||||||||
| Total Transformation Strategy Costs | 13 | 14 | ||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 9 | ||||||||||||
Reversal of Income Tax Valuation Allowance (2) | — | 10 | ||||||||||||
| Non-GAAP Adjusted Income Tax Expense | $ | 273 | $ | 369 | ||||||||||
(1) Reflects impairment charges for long-lived assets for a business within Supply Chain Solutions in 2025. | ||||||||||||||
(2) Reflects the partial reversal of an income tax valuation allowance. | ||||||||||||||
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures
(unaudited)
| Three Months Ended | ||||||||||||||||||||||||||
| March 31, | ||||||||||||||||||||||||||
| (amounts in millions) | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Net Income (GAAP) | $ | 864 | $ | 1,187 | Diluted Earnings Per Share (GAAP) | $ | 1.02 | $ | 1.40 | |||||||||||||||||
| Transformation Strategy Costs: | Transformation Strategy Costs: | |||||||||||||||||||||||||
| Transformation 2.0 | — | 12 | Transformation 2.0 | — | 0.01 | |||||||||||||||||||||
| Fit to Serve | — | 15 | Fit to Serve | — | 0.02 | |||||||||||||||||||||
| Network Reconfiguration and Efficiency Reimagined | 42 | 17 | Network Reconfiguration and Efficiency Reimagined | 0.05 | 0.02 | |||||||||||||||||||||
| Total Transformation Strategy Costs | 42 | 44 | Total Transformation Strategy Costs | 0.05 | 0.05 | |||||||||||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 49 | Goodwill and Asset Impairment Charges (1) | — | 0.05 | |||||||||||||||||||||
Reversal of Income Tax Valuation Allowance (2) | — | (10) | Reversal of Income Tax Valuation Allowance (2) | — | (0.01) | |||||||||||||||||||||
| Non-GAAP Adjusted Net Income | $ | 906 | $ | 1,270 | Non-GAAP Adjusted Diluted Earnings Per Share | $ | 1.07 | $ | 1.49 | |||||||||||||||||
(1) Reflects impairment charges for long-lived assets for a business within Supply Chain Solutions as well the write-down of an equity method investment in 2025. | ||||||||||||||||||||||||||
(2) Reflects the partial reversal of an income tax valuation allowance. | ||||||||||||||||||||||||||
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures by Segment
(unaudited)
| Three Months Ended | |||||||||||||||||||||||||||||||||||
| March 31, | |||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||
| U.S. Domestic Package | Operating Expenses | % Change | Operating Profit | % Change | Operating Margin | ||||||||||||||||||||||||||||||
| GAAP | $ | 13,610 | $ | 13,481 | 1.0 | % | $ | 515 | $ | 979 | (47.4) | % | 3.6 | % | 6.8 | % | |||||||||||||||||||
| Adjusted for: | |||||||||||||||||||||||||||||||||||
| Transformation Strategy Costs | (50) | (32) | 50 | 32 | 0.4 | % | 0.2 | % | |||||||||||||||||||||||||||
| Non-GAAP Adjusted Measure | $ | 13,560 | $ | 13,449 | 0.8 | % | $ | 565 | $ | 1,011 | (44.1) | % | 4.0 | % | 7.0 | % | |||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||
| International Package | Operating Expenses | % Change | Operating Profit | % Change | Operating Margin | ||||||||||||||||||||||||||||||
| GAAP | $ | 3,993 | $ | 3,732 | 7.0 | % | $ | 547 | $ | 641 | (14.7) | % | 12.0 | % | 14.7 | % | |||||||||||||||||||
| Adjusted for: | |||||||||||||||||||||||||||||||||||
| Transformation Strategy Costs | (4) | (13) | 4 | 13 | 0.1 | % | 0.3 | % | |||||||||||||||||||||||||||
| Non-GAAP Adjusted Measure | $ | 3,989 | $ | 3,719 | 7.3 | % | $ | 551 | $ | 654 | (15.7) | % | 12.1 | % | 15.0 | % | |||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||
| Supply Chain Solutions | Operating Expenses | % Change | Operating Profit | % Change | Operating Margin | ||||||||||||||||||||||||||||||
| GAAP | $ | 2,332 | $ | 2,667 | (12.6) | % | $ | 205 | $ | 46 | 345.7 | % | 8.1 | % | 1.7 | % | |||||||||||||||||||
| Adjusted for: | |||||||||||||||||||||||||||||||||||
| Transformation Strategy Costs | (1) | (13) | 1 | 13 | — | % | 0.5 | % | |||||||||||||||||||||||||||
| Goodwill and Asset Impairment Charges | — | (39) | — | 39 | — | % | 1.4 | % | |||||||||||||||||||||||||||
| Non-GAAP Adjusted Measure | $ | 2,331 | $ | 2,615 | (10.9) | % | $ | 206 | $ | 98 | 110.2 | % | 8.1 | % | 3.6 | % | |||||||||||||||||||
United Parcel Service, Inc.
Reconciliation of Free Cash Flow (Non-GAAP measure)
(unaudited)
| Three Months Ended | ||||||||
| March 31, | ||||||||
| (amounts in millions) | 2026 | 2025 | ||||||
| Cash flows from operating activities | $ | 2,224 | $ | 2,318 | ||||
| Capital expenditures | (1,031) | (876) | ||||||
| Proceeds from disposals of property, plant and equipment | 82 | 65 | ||||||
| Other investing activities | 5 | (20) | ||||||
| Free Cash Flow (Non-GAAP measure) | $ | 1,280 | $ | 1,487 | ||||
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures - U.S. Domestic Cost Per Piece
(unaudited)
| Three Months Ended | ||||||||||||||
| March 31, | ||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||
| Operating Days | 62 | 62 | ||||||||||||
| Average Daily U.S. Domestic Package Volume (in thousands) | 16,040 | 17,443 | ||||||||||||
| U.S. Domestic Package Cost Per Piece (GAAP) | $ | 13.40 | $ | 12.22 | 9.7 | % | ||||||||
| Transformation Strategy Costs | (0.05) | (0.03) | ||||||||||||
| U.S. Domestic Package Non-GAAP Adjusted Cost Per Piece | $ | 13.35 | $ | 12.19 | 9.5 | % | ||||||||
Note: Cost per piece excludes expense associated with cargo and other activity.
Exhibit 99.2
United Parcel Service, Inc.
Selected Financial Data - First Quarter
(unaudited)
| Three Months Ended | |||||||||||||||||||||||
| March 31, | |||||||||||||||||||||||
| 2026 | 2025 | Change | % Change | ||||||||||||||||||||
| (amounts in millions, except per share data) | |||||||||||||||||||||||
| Statement of Income Data: | |||||||||||||||||||||||
| Revenue: | |||||||||||||||||||||||
| U.S. Domestic Package | $ | 14,125 | $ | 14,460 | $ | (335) | (2.3) | % | |||||||||||||||
| International Package | 4,540 | 4,373 | 167 | 3.8 | % | ||||||||||||||||||
| Supply Chain Solutions | 2,537 | 2,713 | (176) | (6.5) | % | ||||||||||||||||||
| Total revenue | 21,202 | 21,546 | (344) | (1.6) | % | ||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| U.S. Domestic Package | 13,610 | 13,481 | 129 | 1.0 | % | ||||||||||||||||||
| International Package | 3,993 | 3,732 | 261 | 7.0 | % | ||||||||||||||||||
| Supply Chain Solutions | 2,332 | 2,667 | (335) | (12.6) | % | ||||||||||||||||||
| Total operating expenses | 19,935 | 19,880 | 55 | 0.3 | % | ||||||||||||||||||
| Operating profit: | |||||||||||||||||||||||
| U.S. Domestic Package | 515 | 979 | (464) | (47.4) | % | ||||||||||||||||||
| International Package | 547 | 641 | (94) | (14.7) | % | ||||||||||||||||||
| Supply Chain Solutions | 205 | 46 | 159 | 345.7 | % | ||||||||||||||||||
| Total operating profit | 1,267 | 1,666 | (399) | (23.9) | % | ||||||||||||||||||
| Other income (expense): | |||||||||||||||||||||||
| Other pension income (expense) | 67 | 37 | 30 | 81.1 | % | ||||||||||||||||||
| Investment income (expense) and other | 56 | 42 | 14 | 33.3 | % | ||||||||||||||||||
| Interest expense | (266) | (222) | (44) | 19.8 | % | ||||||||||||||||||
| Total other income (expense) | (143) | (143) | — | 0.0 | % | ||||||||||||||||||
| Income before income taxes | 1,124 | 1,523 | (399) | (26.2) | % | ||||||||||||||||||
| Income tax expense | 260 | 336 | (76) | (22.6) | % | ||||||||||||||||||
| Net income | $ | 864 | $ | 1,187 | $ | (323) | (27.2) | % | |||||||||||||||
| Net income as a percentage of revenue | 4.1 | % | 5.5 | % | |||||||||||||||||||
| Per share amounts: | |||||||||||||||||||||||
| Basic earnings per share | $ | 1.02 | $ | 1.40 | $ | (0.38) | (27.1) | % | |||||||||||||||
| Diluted earnings per share | $ | 1.02 | $ | 1.40 | $ | (0.38) | (27.1) | % | |||||||||||||||
| Weighted-average shares outstanding: | |||||||||||||||||||||||
| Basic | 850 | 850 | — | 0.0 | % | ||||||||||||||||||
| Diluted | 850 | 850 | — | 0.0 | % | ||||||||||||||||||
Non-GAAP Adjusted Income Data (1): | |||||||||||||||||||||||
| Operating profit: | |||||||||||||||||||||||
| U.S. Domestic Package | $ | 565 | $ | 1,011 | $ | (446) | (44.1) | % | |||||||||||||||
| International Package | 551 | 654 | (103) | (15.7) | % | ||||||||||||||||||
| Supply Chain Solutions | 206 | 98 | 108 | 110.2 | % | ||||||||||||||||||
| Total operating profit | 1,322 | 1,763 | (441) | (25.0) | % | ||||||||||||||||||
| Total other income (expense) | $ | (143) | $ | (124) | $ | (19) | 15.3 | % | |||||||||||||||
| Income before income taxes | $ | 1,179 | $ | 1,639 | $ | (460) | (28.1) | % | |||||||||||||||
| Net income | $ | 906 | $ | 1,270 | $ | (364) | (28.7) | % | |||||||||||||||
| Basic earnings per share | $ | 1.07 | $ | 1.49 | $ | (0.42) | (28.2) | % | |||||||||||||||
| Diluted earnings per share | $ | 1.07 | $ | 1.49 | $ | (0.42) | (28.2) | % | |||||||||||||||
(1) See Non-GAAP schedules for reconciliation of adjustments.
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Selected Operating Data - First Quarter
(unaudited)
| Three Months Ended | |||||||||||||||||||||||
| March 31, | |||||||||||||||||||||||
| 2026 | 2025 | Change | % Change | ||||||||||||||||||||
| Revenue (in millions): | |||||||||||||||||||||||
| U.S. Domestic Package: | |||||||||||||||||||||||
| Next Day Air | $ | 2,354 | $ | 2,361 | $ | (7) | (0.3) | % | |||||||||||||||
| Deferred | 1,045 | 1,049 | (4) | (0.4) | % | ||||||||||||||||||
| Ground | 10,438 | 10,709 | (271) | (2.5) | % | ||||||||||||||||||
| Cargo and Other | 288 | 341 | (53) | (15.5) | % | ||||||||||||||||||
| Total U.S. Domestic Package | 14,125 | 14,460 | (335) | (2.3) | % | ||||||||||||||||||
| International Package: | |||||||||||||||||||||||
| Domestic | 835 | 771 | 64 | 8.3 | % | ||||||||||||||||||
| Export | 3,548 | 3,444 | 104 | 3.0 | % | ||||||||||||||||||
| Cargo and Other | 157 | 158 | (1) | (0.6) | % | ||||||||||||||||||
| Total International Package | 4,540 | 4,373 | 167 | 3.8 | % | ||||||||||||||||||
| Supply Chain Solutions: | |||||||||||||||||||||||
| Forwarding | 656 | 726 | (70) | (9.6) | % | ||||||||||||||||||
| Logistics | 1,409 | 1,572 | (163) | (10.4) | % | ||||||||||||||||||
| Other | 472 | 415 | 57 | 13.7 | % | ||||||||||||||||||
| Total Supply Chain Solutions | 2,537 | 2,713 | (176) | (6.5) | % | ||||||||||||||||||
| Consolidated | $ | 21,202 | $ | 21,546 | $ | (344) | (1.6) | % | |||||||||||||||
| Consolidated volume (in millions) | 1,189 | 1,289 | (100) | (7.8) | % | ||||||||||||||||||
| Operating weekdays | 62 | 62 | — | 0.0 | % | ||||||||||||||||||
| Average Daily Package Volume (in thousands): | |||||||||||||||||||||||
| U.S. Domestic Package: | |||||||||||||||||||||||
| Next Day Air | 1,366 | 1,520 | (154) | (10.1) | % | ||||||||||||||||||
| Deferred | 806 | 866 | (60) | (6.9) | % | ||||||||||||||||||
| Ground | 13,868 | 15,057 | (1,189) | (7.9) | % | ||||||||||||||||||
| Total U.S. Domestic Package | 16,040 | 17,443 | (1,403) | (8.0) | % | ||||||||||||||||||
| International Package: | |||||||||||||||||||||||
| Domestic | 1,471 | 1,575 | (104) | (6.6) | % | ||||||||||||||||||
| Export | 1,673 | 1,771 | (98) | (5.5) | % | ||||||||||||||||||
| Total International Package | 3,144 | 3,346 | (202) | (6.0) | % | ||||||||||||||||||
| Consolidated | 19,184 | 20,789 | (1,605) | (7.7) | % | ||||||||||||||||||
| Average Revenue Per Piece: | |||||||||||||||||||||||
| U.S. Domestic Package: | |||||||||||||||||||||||
| Next Day Air | $ | 27.79 | $ | 25.05 | $ | 2.74 | 10.9 | % | |||||||||||||||
| Deferred | 20.91 | 19.54 | 1.37 | 7.0 | % | ||||||||||||||||||
| Ground | 12.14 | 11.47 | 0.67 | 5.8 | % | ||||||||||||||||||
| Total U.S. Domestic Package | 13.91 | 13.06 | 0.85 | 6.5 | % | ||||||||||||||||||
| International Package: | |||||||||||||||||||||||
| Domestic | 9.16 | 7.90 | 1.26 | 15.9 | % | ||||||||||||||||||
| Export | 34.21 | 31.37 | 2.84 | 9.1 | % | ||||||||||||||||||
| Total International Package | 22.49 | 20.32 | 2.17 | 10.7 | % | ||||||||||||||||||
| Consolidated | $ | 15.32 | $ | 14.22 | $ | 1.10 | 7.7 | % | |||||||||||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Detail of Operating Expenses - First Quarter
(unaudited)
| Three Months Ended | |||||||||||||||||||||||
| March 31, | |||||||||||||||||||||||
| 2026 | 2025 | Change | % Change | ||||||||||||||||||||
| (in millions) | |||||||||||||||||||||||
| Compensation and benefits | $ | 11,545 | $ | 11,827 | $ | (282) | (2.4) | % | |||||||||||||||
| Repairs and maintenance | 792 | 732 | 60 | 8.2 | % | ||||||||||||||||||
| Depreciation and amortization | 985 | 912 | 73 | 8.0 | % | ||||||||||||||||||
| Purchased transportation | 2,764 | 2,730 | 34 | 1.2 | % | ||||||||||||||||||
| Fuel | 1,083 | 1,058 | 25 | 2.4 | % | ||||||||||||||||||
| Other occupancy | 674 | 607 | 67 | 11.0 | % | ||||||||||||||||||
| Other expenses | 2,092 | 2,014 | 78 | 3.9 | % | ||||||||||||||||||
| Total operating expenses | $ | 19,935 | $ | 19,880 | $ | 55 | 0.3 | % | |||||||||||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Consolidated Balance Sheets
March 31, 2026 (unaudited) and December 31, 2025 (amounts in millions)
| March 31, 2026 | December 31, 2025 | ||||||||||
| ASSETS | |||||||||||
| Current Assets: | |||||||||||
| Cash and cash equivalents | $ | 5,802 | $ | 5,887 | |||||||
Accounts receivable, net | 9,948 | 11,209 | |||||||||
| Other current assets | 2,044 | 1,949 | |||||||||
| Total Current Assets | 17,794 | 19,045 | |||||||||
| Property, Plant and Equipment, Net | 38,029 | 37,731 | |||||||||
| Operating Lease Right-Of-Use Assets | 4,084 | 4,263 | |||||||||
| Goodwill | 5,796 | 5,837 | |||||||||
| Intangible Assets, Net | 3,981 | 4,021 | |||||||||
| Deferred Income Tax Assets | 154 | 140 | |||||||||
| Other Non-Current Assets | 1,971 | 2,053 | |||||||||
| Total Assets | $ | 71,809 | $ | 73,090 | |||||||
| LIABILITIES AND SHAREOWNERS' EQUITY | |||||||||||
| Current Liabilities: | |||||||||||
| Current maturities of long-term debt, commercial paper and finance leases | $ | 637 | $ | 608 | |||||||
| Current maturities of operating leases | 742 | 763 | |||||||||
| Accounts payable | 5,913 | 6,633 | |||||||||
| Accrued wages and withholdings | 3,238 | 3,715 | |||||||||
| Self-insurance reserves | 1,095 | 1,137 | |||||||||
| Accrued group welfare and retirement plan contributions | 1,414 | 1,389 | |||||||||
| Other current liabilities | 1,635 | 1,375 | |||||||||
| Total Current Liabilities | 14,674 | 15,620 | |||||||||
| Long-Term Debt and Finance Leases | 23,749 | 23,519 | |||||||||
| Non-Current Operating Leases | 3,534 | 3,700 | |||||||||
| Pension and Postretirement Benefit Obligations | 6,665 | 6,567 | |||||||||
| Deferred Income Tax Liabilities | 3,772 | 3,690 | |||||||||
| Other Non-Current Liabilities | 3,624 | 3,739 | |||||||||
| Shareowners' Equity: | |||||||||||
| Class A common stock | 1 | 1 | |||||||||
| Class B common stock | 8 | 8 | |||||||||
| Additional paid-in capital | 382 | 275 | |||||||||
| Retained earnings | 19,622 | 20,151 | |||||||||
| Accumulated other comprehensive loss | (4,250) | (4,208) | |||||||||
| Deferred compensation obligations | 5 | 5 | |||||||||
| Less: Treasury stock | (5) | (5) | |||||||||
| Total Equity for Controlling Interests | 15,763 | 16,227 | |||||||||
| Noncontrolling interests | 28 | 28 | |||||||||
| Total Shareowners' Equity | 15,791 | 16,255 | |||||||||
| Total Liabilities and Shareowners' Equity | $ | 71,809 | $ | 73,090 | |||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Statements of Consolidated Cash Flows
(In millions, unaudited)
| Three Months Ended | |||||||||||||||||
| March 31, | |||||||||||||||||
| 2026 | 2025 | ||||||||||||||||
| Cash Flows From Operating Activities: | |||||||||||||||||
| Net income | $ | 864 | $ | 1,187 | |||||||||||||
| Adjustments to reconcile net income to net cash from operating activities: | |||||||||||||||||
| Depreciation and amortization | 985 | 912 | |||||||||||||||
| Pension and postretirement benefit expense | 215 | 257 | |||||||||||||||
| Pension and postretirement benefit contributions | (79) | (67) | |||||||||||||||
| Self-insurance reserves | 16 | 1 | |||||||||||||||
Deferred tax (benefit) expense | 45 | (40) | |||||||||||||||
Stock compensation expense | 24 | 21 | |||||||||||||||
Other (gains) losses | 73 | 22 | |||||||||||||||
| Changes in assets and liabilities, net of effects of business acquisitions: | |||||||||||||||||
| Accounts receivable | 1,085 | 960 | |||||||||||||||
| Other assets | (27) | 7 | |||||||||||||||
| Accounts payable | (495) | (906) | |||||||||||||||
| Accrued wages and withholdings | (453) | (370) | |||||||||||||||
| Other liabilities | 29 | 301 | |||||||||||||||
| Other operating activities | (58) | 33 | |||||||||||||||
| Net cash from operating activities | 2,224 | 2,318 | |||||||||||||||
| Cash Flows From Investing Activities: | |||||||||||||||||
| Capital expenditures | (1,031) | (876) | |||||||||||||||
| Proceeds from disposal of businesses, property, plant and equipment | 82 | 65 | |||||||||||||||
| Purchases of marketable securities | — | (90) | |||||||||||||||
| Sales and maturities of marketable securities | — | 34 | |||||||||||||||
| Acquisitions, net of cash acquired | — | (478) | |||||||||||||||
| Other investing activities | 5 | (10) | |||||||||||||||
Net cash used in investing activities | (944) | (1,355) | |||||||||||||||
| Cash Flows From Financing Activities: | |||||||||||||||||
| Proceeds from long-term borrowings | — | 25 | |||||||||||||||
| Repayments of long-term borrowings | (46) | (32) | |||||||||||||||
| Purchases of common stock | — | (1,000) | |||||||||||||||
| Issuances of common stock | 28 | 55 | |||||||||||||||
| Dividends | (1,352) | (1,348) | |||||||||||||||
| Other financing activities | 42 | (13) | |||||||||||||||
| Net cash used in financing activities | (1,328) | (2,313) | |||||||||||||||
| Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash | (37) | 40 | |||||||||||||||
Net Decrease in Cash, Cash Equivalents and Restricted Cash | (85) | (1,310) | |||||||||||||||
| Cash, Cash Equivalents and Restricted Cash: | |||||||||||||||||
| Beginning of period | 5,887 | 6,112 | |||||||||||||||
| End of period | $ | 5,802 | $ | 4,802 | |||||||||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Reconciliation of Free Cash Flow (Non-GAAP measure)
(In millions, unaudited)
| Three Months Ended | |||||||||||||||||||||||||||||||||||
| March 31, | |||||||||||||||||||||||||||||||||||
| 2026 | 2025 | ||||||||||||||||||||||||||||||||||
| Cash flows from operating activities | $ | 2,224 | $ | 2,318 | |||||||||||||||||||||||||||||||
| Capital expenditures | (1,031) | (876) | |||||||||||||||||||||||||||||||||
| Proceeds from disposals of property, plant and equipment | 82 | 65 | |||||||||||||||||||||||||||||||||
| Other investing activities | 5 | (20) | |||||||||||||||||||||||||||||||||
| Free Cash Flow (Non-GAAP measure) | $ | 1,280 | $ | 1,487 | |||||||||||||||||||||||||||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures
(unaudited)
| Three Months Ended | ||||||||||||||||||||||||||
| March 31, | ||||||||||||||||||||||||||
| (amounts in millions) | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Operating Profit (GAAP) | $ | 1,267 | $ | 1,666 | Operating Margin (GAAP) | 6.0 | % | 7.7 | % | |||||||||||||||||
| Transformation Strategy Costs: | Transformation Strategy Costs: | |||||||||||||||||||||||||
| Transformation 2.0 | — | 16 | Transformation 2.0 | — | 0.1 | % | ||||||||||||||||||||
| Fit to Serve | — | 19 | Fit to Serve | — | % | 0.1 | % | |||||||||||||||||||
| Network Reconfiguration and Efficiency Reimagined | 55 | 23 | Network Reconfiguration and Efficiency Reimagined | 0.2 | % | 0.1 | % | |||||||||||||||||||
| Total Transformation Strategy Costs | 55 | 58 | Total Transformation Strategy Costs | 0.2 | % | 0.3 | % | |||||||||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 39 | Goodwill and Asset Impairment Charges (1) | — | % | 0.2 | % | |||||||||||||||||||
| Non-GAAP Adjusted Operating Profit | $ | 1,322 | $ | 1,763 | Non-GAAP Adjusted Operating Margin | 6.2 | % | 8.2 | % | |||||||||||||||||
(1) Reflects impairment charges for long-lived assets for a business within Supply Chain Solutions in 2025. | ||||||||||||||||||||||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures
(unaudited)
| Three Months Ended | ||||||||||||||||||||||||||
| March 31, | ||||||||||||||||||||||||||
| (amounts in millions) | 2026 | 2025 | (amounts in millions) | 2026 | 2025 | |||||||||||||||||||||
| Other Income (Expense) (GAAP) | $ | (143) | $ | (143) | Income Before Income Taxes (GAAP) | $ | 1,124 | $ | 1,523 | |||||||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 19 | Transformation Strategy Costs: | |||||||||||||||||||||||
| Transformation 2.0 | — | 16 | ||||||||||||||||||||||||
| Non-GAAP Adjusted Other Income (Expense) | (143) | (124) | ||||||||||||||||||||||||
| Fit to Serve | — | 19 | ||||||||||||||||||||||||
| Network Reconfiguration and Efficiency Reimagined | 55 | 23 | ||||||||||||||||||||||||
| Total Transformation Strategy Costs | 55 | 58 | ||||||||||||||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 58 | ||||||||||||||||||||||||
| Non-GAAP Adjusted Income Before Income Taxes | 1,179 | 1,639 | ||||||||||||||||||||||||
(1) Reflects impairment charges for long-lived assets for a business within Supply Chain Solutions as well the write-down of an equity method investment in 2025. | ||||||||||||||||||||||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures
(unaudited)
| Three Months Ended | |||||||||||||||||||||||||||||
| March 31, | |||||||||||||||||||||||||||||
| (amounts in millions) | 2026 | 2025 | |||||||||||||||||||||||||||
| Income Tax Expense (GAAP) | $ | 260 | $ | 336 | |||||||||||||||||||||||||
| Transformation Strategy Costs: | |||||||||||||||||||||||||||||
| Transformation 2.0 | — | 4 | |||||||||||||||||||||||||||
| Fit to Serve | — | 4 | |||||||||||||||||||||||||||
| Network Reconfiguration and Efficiency Reimagined | 13 | 6 | |||||||||||||||||||||||||||
| Total Transformation Strategy Costs | 13 | 14 | |||||||||||||||||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 9 | |||||||||||||||||||||||||||
Reversal of Income Tax Valuation Allowance (2) | — | 10 | |||||||||||||||||||||||||||
| Non-GAAP Adjusted Income Tax Expense | $ | 273 | $ | 369 | |||||||||||||||||||||||||
(1) Reflects impairment charges for long-lived assets for a business within Supply Chain Solutions in 2025. | |||||||||||||||||||||||||||||
(2) Reflects the partial reversal of an income tax valuation allowance. | |||||||||||||||||||||||||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures
(unaudited)
| Three Months Ended | ||||||||||||||||||||||||||
| March 31, | ||||||||||||||||||||||||||
| (amounts in millions) | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Net Income (GAAP) | $ | 864 | $ | 1,187 | Diluted Earnings Per Share (GAAP) | $ | 1.02 | $ | 1.40 | |||||||||||||||||
| Transformation Strategy Costs: | Transformation Strategy Costs: | |||||||||||||||||||||||||
| Transformation 2.0 | — | 12 | Transformation 2.0 | — | 0.01 | |||||||||||||||||||||
| Fit to Serve | — | 15 | Fit to Serve | — | 0.02 | |||||||||||||||||||||
| Network Reconfiguration and Efficiency Reimagined | 42 | 17 | Network Reconfiguration and Efficiency Reimagined | 0.05 | 0.02 | |||||||||||||||||||||
| Total Transformation Strategy Costs | 42 | 44 | Total Transformation Strategy Costs | 0.05 | 0.05 | |||||||||||||||||||||
Goodwill and Asset Impairment Charges (1) | — | 49 | Goodwill and Asset Impairment Charges (1) | — | 0.05 | |||||||||||||||||||||
Reversal of Income Tax Valuation Allowance (2) | — | (10) | Reversal of Income Tax Valuation Allowance (2) | — | (0.01) | |||||||||||||||||||||
| Non-GAAP Adjusted Net Income | $ | 906 | $ | 1,270 | Non-GAAP Adjusted Diluted Earnings Per Share | $ | 1.07 | $ | 1.49 | |||||||||||||||||
(1) Reflects impairment charges for long-lived assets for a business within Supply Chain Solutions as well the write-down of an equity method investment in 2025. | ||||||||||||||||||||||||||
(2) Reflects the partial reversal of an income tax valuation allowance. | ||||||||||||||||||||||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures by Segment
(unaudited)
| Three Months Ended | |||||||||||||||||||||||||||||||||||
| March 31, | |||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||
| U.S. Domestic Package | Operating Expenses | % Change | Operating Profit | % Change | Operating Margin | ||||||||||||||||||||||||||||||
| GAAP | $ | 13,610 | $ | 13,481 | 1.0 | % | $ | 515 | $ | 979 | (47.4) | % | 3.6 | % | 6.8 | % | |||||||||||||||||||
| Adjusted for: | |||||||||||||||||||||||||||||||||||
| Transformation Strategy Costs | (50) | (32) | 50 | 32 | 0.4 | % | 0.2 | % | |||||||||||||||||||||||||||
| Non-GAAP Adjusted Measure | $ | 13,560 | $ | 13,449 | 0.8 | % | $ | 565 | $ | 1,011 | (44.1) | % | 4.0 | % | 7.0 | % | |||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||
| International Package | Operating Expenses | % Change | Operating Profit | % Change | Operating Margin | ||||||||||||||||||||||||||||||
| GAAP | $ | 3,993 | $ | 3,732 | 7.0 | % | $ | 547 | $ | 641 | (14.7) | % | 12.0 | % | 14.7 | % | |||||||||||||||||||
| Adjusted for: | |||||||||||||||||||||||||||||||||||
| Transformation Strategy Costs | (4) | (13) | 4 | 13 | 0.1 | % | 0.3 | % | |||||||||||||||||||||||||||
| Non-GAAP Adjusted Measure | $ | 3,989 | $ | 3,719 | 7.3 | % | $ | 551 | $ | 654 | (15.7) | % | 12.1 | % | 15.0 | % | |||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||||||||||
| Supply Chain Solutions | Operating Expenses | % Change | Operating Profit | % Change | Operating Margin | ||||||||||||||||||||||||||||||
| GAAP | $ | 2,332 | $ | 2,667 | (12.6) | % | $ | 205 | $ | 46 | 345.7 | % | 8.1 | % | 1.7 | % | |||||||||||||||||||
| Adjusted for: | |||||||||||||||||||||||||||||||||||
| Transformation Strategy Costs | (1) | (13) | 1 | 13 | — | % | 0.5 | % | |||||||||||||||||||||||||||
| Goodwill and Asset Impairment Charges | — | (39) | — | 39 | — | % | 1.4 | % | |||||||||||||||||||||||||||
| Non-GAAP Adjusted Measure | $ | 2,331 | $ | 2,615 | (10.9) | % | $ | 206 | $ | 98 | 110.2 | % | 8.1 | % | 3.6 | % | |||||||||||||||||||
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Reconciliation of GAAP and Non-GAAP Adjusted Measures - U.S. Domestic Cost Per Piece
(unaudited)
| Three Months Ended | ||||||||||||||
| March 31, | ||||||||||||||
| 2026 | 2025 | % Change | ||||||||||||
| Operating Days | 62 | 62 | ||||||||||||
| Average Daily U.S. Domestic Package Volume (in thousands) | 16,040 | 17,443 | ||||||||||||
| U.S. Domestic Package Cost Per Piece (GAAP) | $ | 13.40 | $ | 12.22 | 9.7 | % | ||||||||
| Transformation Strategy Costs | (0.05) | (0.03) | ||||||||||||
| U.S. Domestic Package Non-GAAP Adjusted Cost Per Piece | $ | 13.35 | $ | 12.19 | 9.5 | % | ||||||||
Note: Cost per piece excludes expense associated with cargo and other activity.
Certain amounts are calculated based on unrounded numbers.
United Parcel Service, Inc.
Aircraft Fleet - As of March 31, 2026
(unaudited)
| Description | UPS Owned and/or Operated | Charters & Leases Operated by Others | On Order | Under Option | ||||||||||
| Boeing 757-200 | 75 | — | — | — | ||||||||||
| Boeing 767-300 | 92 | — | 15 | — | ||||||||||
| Boeing 767-300BCF | 6 | — | — | — | ||||||||||
| Boeing 767-300BDSF | 4 | — | — | — | ||||||||||
| Airbus A300-600 | 52 | — | — | — | ||||||||||
| Boeing 747-400F | 11 | — | — | — | ||||||||||
| Boeing 747-400BCF | 2 | — | — | — | ||||||||||
| Boeing 747-8F | 30 | — | — | — | ||||||||||
| Other | — | 218 | — | — | ||||||||||
| Total | 272 | 218 | 15 | — | ||||||||||
Certain amounts are calculated based on unrounded numbers.
FAQ
How did UPS (UPS) perform financially in Q1 2026?
UPS reported Q1 2026 revenue of $21.2 billion, operating profit of $1.27 billion, and diluted EPS of $1.02. On a non-GAAP basis, operating profit was $1.32 billion and diluted EPS was $1.07, excluding after-tax transformation charges.
What were UPS (UPS) U.S. Domestic, International and Supply Chain results in Q1 2026?
U.S. Domestic revenue was $14.1 billion, down 2.3%, with a 3.6% operating margin. International revenue reached $4.54 billion, up 3.8%, with a 12.0% margin. Supply Chain Solutions revenue was $2.54 billion and operating profit $205 million, for an 8.1% margin.
What full-year 2026 guidance did UPS (UPS) reaffirm?
UPS reaffirmed 2026 consolidated revenue guidance of approximately $89.7 billion and a non-GAAP adjusted operating margin of about 9.6%. It also expects capital expenditures near $3.0 billion and dividend payments around $5.4 billion, subject to board approval.
How much is UPS saving from its transformation initiatives in 2026?
UPS achieved about $600 million of transformation program cost savings in the first three months of 2026 and targets roughly $3 billion of full-year 2026 year-over-year savings. Related non-GAAP excluded operating expenses are expected between $1.3 and $1.5 billion during 2026.
What were UPS (UPS) Q1 2026 non-GAAP adjustments and why are they used?
Q1 2026 non-GAAP adjustments mainly removed $42 million of after-tax transformation strategy costs. UPS presents non-GAAP measures such as adjusted operating profit and EPS so management and investors can evaluate underlying business performance excluding large, specific transformation and impairment items.
How did UPS (UPS) free cash flow look in Q1 2026?
UPS generated Q1 2026 free cash flow of $1.28 billion, calculated from operating cash flows of $2.22 billion, capital expenditures of $1.03 billion, proceeds from asset disposals of $82 million, and other investing activities. Free cash flow helps indicate cash available for investment and shareholder returns.