News built for finance pros
CFO Brew helps finance pros navigate their roles with insights into risk management, compliance, and strategy through our newsletter, virtual events, and digital guides.
The holiday season matters. For us, it’s a way to mark the cruel passage of time, and, you know, see family. And for the United Parcel Service, it matters for the bottom line.
Good thing, then, that going into this year’s holiday season, UPS finally returned to growth. It was the first time in two years that the company posted year over year revenue and profit growth.
The shipping giant reported $22.2 billion in revenue, a 5.6% jump from last year. Net income came in at $1.5 billion. UPS also upped its full-year operating margin estimate.
“After a challenging 18-month period, our company returned to revenue and profit growth,” CEO Carol Tomé said. “Peak season is nearly upon us, and we are ready to deliver another successful holiday season and continue the progress we demonstrated in the third quarter.”
On the company’s earnings call, CFO Brian Dykes noted that UPS’s US domestic segment clocked its highest volume growth rate in over three years.
Yet even as UPS clears some crucial hurdles, this holiday season isn’t a guaranteed win. On the earnings call, Tomé noted that, given Thanksgiving’s late date this year, “there are only 17 shipping days between Thanksgiving and Christmas Eve,” and “forecasters and some of [UPS’s] customers” have said that people may shop in person more as a result.
“The consumer actually is in pretty good shape, but we think there’ll be some dynamics in how the consumer shops during the peak season,” she added. “It will still be a good peak, but just not as dynamic as people thought at the beginning of the year. Whatever happens, we’re prepared. We’re prepared to handle the volume.”