UPS to cut 20K jobs as it reduces Amazon volume

UPS reported $21.5 billion in operating revenue for the first quarter of 2025, down 0.7% year over year, and will cut 20,000 jobs this year. The job cuts are in line with the total Amazon volume decline, Chief Financial Officer Brian Dykes said on today’s earnings call. [caption id="attachment_56866998" align="aligncenter" width="1235"] UPS plans to retire three MD-11Fs in 2025. (Courtesy/UPS)[/caption] UPS announced plans to reduce Amazon’s volume with UPS by more than 50% by the second half of 2026 during its full-year 2024 earnings call on Jan. 30. This plan is expected to address future diminishing returns from the concentration of volume and revenue from Amazon. “The Amazon glide-down plans have been integrated into our network of future initiatives,” Chief Executive Carol Tome said on today’s call. “We are executing the largest network reconfiguration in our history.” Part of this initiative includes increased automation and reduced dependency on labor, Tome said. “United Parcel Service is contractually obligated to create 30,000 Teamsters jobs under our current national master agreement,” the UPS Teamsters said in a statement following today’s earnings call. “If UPS wants to continue to downsize corporate management, the Teamsters won’t stand in its way. But if the company intends to violate our contract or makes any attempt to go after hard-fought, good-paying Teamsters jobs, UPS will be in for a hell of a fight.” The Teamsters ratified a five-year contract in September 2023 and, in January 2024, UPS announced it would terminate 12,000 positions . Fleet UPS has orders for twenty-four 767-300Fs, having signed up for eight more in December 2024. The integrator intends to retire three MD-11s in 2025, reducing its MD-11 fleet to twenty-six, according to its latest fleet table released today. The company aims to replace its MD-11Fs with the 767s. Q1 results UPS reported a Q1 adjusted operating profit of $1.8 billion, up 0.9% YoY. The integrator also reported: Adjusted diluted earnings per share of $1.49 billion, up 4.2% YoY; Adjusted income before taxes of $1.6 billion, down 1.9% YoY; U.S. domestic segment revenue of $14.5 billion, up 1.4% YoY; International segment revenue of $4.4 billion, up 2.7% YoY; and Revenue for Supply Chain Solutions, the company’s forwarding and logistics arm, of $2.7 billion, down 14.8% YoY. Revenue growth in the U.S. domestic segment was driven by increases in air cargo and a 4.5% improvement in revenue per piece, which partially offset a decline in volume, according to the earnings report. “While we expected negative [average daily volume] (ADV) growth given our Amazon glide-down plan, January's ADV decline was less than expected,” Tome said. “Then, as we moved into February and March, uncertainty surrounding global trade policies and other matters led to a drop in consumer confidence and muted demand. ... As a result, the decline in U.S. ADV for the months of February and March was higher than we expected.” Revenue growth in the international segment was driven by a 7.1% increase in average daily volume, according to the earnings report. "Demand for U.S. inbound services surged as customers pulled forward inventory purchases ahead of expected tariff changes,” Tome said. Transactions For the second consecutive quarter, UPS attributed Supply Chain Solutions’ decline in revenue to the company spinning off Coyote Logistics. Transportation solutions company RXO acquired Coyote from UPS for more than $1 billion in September 2024. UPS announced last week that it has entered into a definitive agreement to acquire Andlauer Healthcare Group (AHG), a Canadian supply chain management company. Under the terms of the agreement, AHG shareholders will receive CA$55 ($39.72) per share in cash, representing a total purchase price of about $1.6 billion, UPS said in an April 24 release. UPS aims to complete the transaction in H2 2025. Shares of UPS ( NYSE: UPS ) were down 0.45% from market open to $96.65 as of market close today. UPS has a market capitalization of $82.4 billion. Editor’s note: All amounts have been converted to U.S. dollars. Register now for Cargo Facts EMEA, an essential regional event for industry stakeholders, on May 6-8 at the Shangri-La Bosphorus in Turkey.

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