Q3 profit/revenue fall: Stock up 11%
 

We are still profitably shrinking overall. I still think we need a better path forward from management, but I’m just a line pilot.

UPS Q3 Earnings

Shares rose 11% in premarket trading to $98.60. Through Monday’s close, the stock has lost more than a quarter of its value since the beginning of the year.

The package-delivery company posted a profit of $1.31 billion, or $1.55 a share, compared with $1.54 billion, or $1.80 a share, a year earlier. The quarter included about $250 million in charges related to restructuring efforts.

Stripping out certain one-time items, earnings were $1.74 a share. Analysts polled by FactSet were expecting adjusted earnings of $1.29 a share.



For the current quarter, which includes the key holiday season, UPS expects revenue of about $24 billion. Analysts are looking for $23.82 billion. “We are positioned to run the most efficient peak in our history,” Chief Executive Carol Tome said.

Tome has been under pressure to reverse a long slump in the company’s stock price. The pressure stems particularly from employees and retirees, who have an outsized say under the company’s unique shareholder structure, The Journal previously reported.

Many UPS workers and retirees own supervoting shares that give them 63% of the voting power.

The substantial earnings beat is good for negotiations IMO.

Yes and no. More money is always better for negotiations and it appears the airline is essential to future corporate success. However, at some point shrinking revenues and profits year over year will result in a smaller pie to carve our piece out of. We, and investors, would benefit from a C suite that drives both top line and bottom line growth. The stock is still doing poorly YTD, even after jumping 11%. My opinion is that we will see a new CEO in 2026. How does that impacts our negotiations? I have no idea.

The stock has never NOT performed poorly, IMO.

For years, FDX stock was soaring while UPS was stagnating or going down despite UPS earning far far far more income than FDX. Why? FDX was growing their revenue more rapidly, even though their margins on that growth were barely positive. It should surprise absolutely nobody that our stock price dropped as the COVID crack high of revenue and volume started to wane, as obviously growth without fundamentals support isn't sustainable (look at Spirit). Arguably "Better and Bolder" is a counter to FDX's current network and organizational transformation (or whatever buzzword they are calling it).

Making $1.3B in Q3 is good news, no matter how it is sliced.

More money is good, but I’m less optimistic about it coming from less volume. I don’t know if the transcript is out yet or if they said what volume specifically is down. If NDA and international is up, then that would be better for negotiations rather than simply beating a revenue forecast.

FedEx cost cutting initiate is known as DRIVE.

FedEx Network 2.0 is probably our equivalent of the UPS "Better and Bolder."

Agree. This was a decent Q3.
However, UPS is a terrible "investment" for medium to long term investors. Short term appears to be good at the moment.

I just work here.

:D

Don’t we all. I don’t invest in UPS stock simply to avoid putting too many eggs in one basket. However, I do try to maintain SA on what direction Wall Street sees the company trending. I don’t want to be that Pan Am pilot who was taken completely by surprise when it went belly up. (Yes, I’ve met a few who were) While I don’t see UPS going away anytime soon ($1.3B 3rd quarter profit). I could imagine it’s business model changing in a way that negatively impacts the pilot group. (No, I see no sign of this happening currently)