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Domestic and international volumes declined in final quarter of 2023 from a year earlier




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UPS unveiled job cuts on Tuesday in an efficiency push after its revenue declined.


United Parcel Service UPS -7.21%decrease; red down pointing triangle plans to cut about 12,000 jobs this year and mandated staff return to offices five days a week, as the package-delivery company is girding its business for a slowdown in shipments.

Most of these cuts will be full-time and part-time management positions and contract workers, UPS executives said Tuesday, adding that the jobs aren’t likely to return even when parcel volumes rebound. The company employs around 85,000 workers in management.

UPS has about 495,000 employees worldwide, most of whom work in the U.S. and handle or transport packages.

Chief Executive Carol Tomé said the cuts are part of efforts to change how the company works. Part of the efficiency push includes using artificial intelligence and other new technologies to boost its operations, she said.

The moves came after the company said its revenue declined in the last quarter of 2023 as volumes in both its domestic and international businesses dropped. It guided revenue in 2024 to be between $92 billion and $94.5 billion, which was below analysts’ forecasts.

Shares in UPS fell more than 8% in morning trading. UPS said it expects small-package volume growth in the U.S. to be less than 1% this year, though in the long-term it projects a 3% growth rate.

UPS, based in Atlanta, is also joining a number of companies that want employees to work from offices every weekday. The company faced contentious labor negotiations last year in which union officials brought up resentment that drivers and warehouse workers who worked in-person during the pandemic felt while office staffers could work from home.


UPS CEO Carol Tomé says job cuts are part of efforts to use artificial intelligence and other new technologies.

“In terms of our culture, we are a network company, not just of logistics capabilities, but of personal relationships, too,” she said on a conference call.

The 2024 recovery is likely to be uneven for UPS. The company noted a decline from industrial production from Europe, and, while volumes of small packages picked up in the shipping lane from China to the U.S. late last year, it remains cautious about business prospects.

UPS’s largest customer, Amazon.com, accounted for 11.8% of the company’s revenue in 2023, higher than 2022’s 11.3%, but executives said this resulted from steeper revenue declines from other customers.

UPS has been intentionally reducing volume from Amazon for years. Other customers of UPS have either suffered much lower demand or have boosted their buy online, pick up in store abilities, said Tomé.

UPS’s truckload brokerage unit, Coyote Logistics, was a drag on the company’s revenue. This business has been hit hard by excess capacity from higher inventory levels and consumers spending more on services than on goods. Tomé said UPS was looking at strategic alternatives for Coyote, which UPS purchased in 2015 to expand the company’s portfolio.

“I don’t think we fully understood at the time just how cyclical this business is,” said Tomé.

link: https://www.wsj.com/business/e...siness-slows-d832f1d

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Originally posted by ZSMICHAEL:
The company employs around 85,000 workers in management.

UPS has about 495,000 employees worldwide....

So about 4 "Workers" for every Manager, for being a Delivery Company that sure seems high.

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UPS has been intentionally reducing volume from Amazon for years. Other customers of UPS have either suffered much lower demand or have boosted their buy online, pick up in store abilities, said Tomé.

Nice spin job. Amazon startings its own delivery division surprised the crap out of UPS, FEDEX, and USPS.