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The
Atlanta company is caught in a profit squeeze in the wake of
contract talks with its Teamsters-represented workforce.
The world's biggest package delivery firm now expects full-year
revenue between $91.3 billion and $92.3 billion, compared with a
prior forecast of about $93 billion.
UPS also cut its annual adjusted operating margin to between
10.8% and 11.3% compared to prior forecast of about 11.8%.
The entire industry is fighting for market share as demand from
e-commerce delivery weakens. Reuters reported earlier this month
that UPS and its rivals for the first time in years have been
using discounts and other incentives to maintain and win market
share.
"While unfavorable macro-economic conditions negatively impacted
global demand in the quarter, our U.S. labor contract was fully
ratified in early September and volume that diverted during our
labor negotiations is starting to return to our network," UPS
chief Carol Tomé said in a statement.
UPS, often seen as a bellwether for the U.S. economy, and other
logistics companies have been racing to match costs to global
demand that has fallen back to pre-pandemic levels.
UPS has been cutting jobs and leaning on technology to help
offset falling e-commerce demand, weak export and industrial
production and the cost hit from its new labor contract.
On Thursday, the company posted an adjusted profit per share of
$1.57 in the quarter through September compared with the
analysts' average estimate of $1.52, as per LSEG data.
(Reporting by Priyamvada C and Lisa Baertlein; Editing by Arun
Koyyur)
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