UPS RELEASES 3Q 2026 EARNINGS
UNITED PARCEL SERVICE INC (UPS) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 UPS RELEASES 3Q 2026 EARNINGS Consolidated Revenue Increased 6.7% to $22.9B, with Growth Across All Segments • Consolidated Operating Margin of 7.6%; Non-GAAP Adj. Consolidated Operating Margin * of 9.0% • Diluted EPS of $1.37; Non-GAAP Adj. Diluted EPS of $1.69 • Ra
How this was made
The 30-second read
Why it matters
The raised guidance is a primary disclosure that can move the stock.
Market read
UPS's guidance lift is a material earnings update for a large-cap carrier.
What to watch
Potential macro headwinds could temper the impact of the raised guidance.
UPS releases 3Q 2026 earnings: consolidated revenue increased 6.7% to $22.9B; raises fourth-quarter 2026 financial guidance and full-year 2026 outlook.
Third-quarter revenue increased across all segments and UPS raised fourth-quarter and full-year guidance, but consolidated GAAP operating profit, non-GAAP adjusted operating profit, GAAP net income, non-GAAP adjusted net income, GAAP EPS and non-GAAP adjusted EPS were below the prior-year quarter. Supply Chain Solutions operating profit declined substantially, including a goodwill impairment charge.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| 3Q 2026 consolidated revenueGAAP | $22.9B | – | 6.7% |
| 3Q 2026 consolidated operating profitGAAP | $1.74B | – | – |
| 3Q 2026 consolidated operating marginGAAP | 7.6% | – | – |
| 3Q 2026 non-GAAP adjusted consolidated operating profitnon-GAAP | $2.05B | – | – |
| 3Q 2026 non-GAAP adjusted consolidated operating marginnon-GAAP | 9.0% | – | – |
| 3Q 2026 income before income taxesGAAP | $1.57B | – | – |
| 3Q 2026 income tax expenseGAAP | $408M | – | – |
| 3Q 2026 non-GAAP adjusted income before income taxesnon-GAAP | $1.88B | – | – |
| 3Q 2026 non-GAAP adjusted income tax expensenon-GAAP | $439M | – | – |
| 3Q 2026 net incomeGAAP | $1.16B | – | – |
| 3Q 2026 non-GAAP adjusted net incomenon-GAAP | $1.44B | – | – |
| 3Q 2026 diluted earnings per shareGAAP | $ 1.37 | – | – |
| 3Q 2026 non-GAAP adjusted diluted earnings per sharenon-GAAP | $ 1.69 | – | – |
| 3Q 2026 U.S. Domestic Package operating expensesGAAP | $13.96B | – | 2.5% |
| 3Q 2026 U.S. Domestic Package non-GAAP adjusted operating expensesnon-GAAP | $13.83B | – | 3.9% |
| 3Q 2026 International Package operating expensesGAAP | $4.26B | – | 6.6% |
| 3Q 2026 International Package non-GAAP adjusted operating expensesnon-GAAP | $4.26B | – | 7.0% |
| 3Q 2026 Supply Chain Solutions operating expensesGAAP | $2.89B | – | 44.7% |
| 3Q 2026 Supply Chain Solutions non-GAAP adjusted operating expensesnon-GAAP | $2.71B | – | 36.3% |
| 3Q 2026 average daily U.S. Domestic Package volumeother | 15.62M | – | – |
| 3Q 2026 U.S. Domestic Package cost per pieceGAAP | $ 13.45 | – | 4.1% |
| 3Q 2026 U.S. Domestic Package non-GAAP adjusted cost per piecenon-GAAP | $ 13.32 | – | 5.5% |
| Nine months ended September 30, 2026 operating profitGAAP | $3.94B | – | – |
| Nine months ended September 30, 2026 operating marginGAAP | 5.9% | – | – |
| Nine months ended September 30, 2026 non-GAAP adjusted operating profitnon-GAAP | $5.48B | – | – |
| Nine months ended September 30, 2026 non-GAAP adjusted operating marginnon-GAAP | 8.2% | – | – |
| Nine months ended September 30, 2026 net incomeGAAP | $2.63B | – | – |
| Nine months ended September 30, 2026 non-GAAP adjusted net incomenon-GAAP | $3.84B | – | – |
| Nine months ended September 30, 2026 diluted earnings per shareGAAP | $ 3.09 | – | – |
| Nine months ended September 30, 2026 non-GAAP adjusted diluted earnings per sharenon-GAAP | $ 4.52 | – | – |
| Nine months ended September 30, 2026 cash flows from operating activitiesGAAP | $5.99B | – | – |
| Nine months ended September 30, 2026 capital expendituresother | −2.22B | – | – |
| Nine months ended September 30, 2026 free cash flownon-GAAP | $4.22B | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| U.S. Domestic SegmentRevenue increased 4.5%, driven by a 6.1% increase in revenue per piece. GAAP operating profit was $906 M versus $603 M, while non-GAAP adjusted operating profit was $1,034 M versus $905 M. | $14.87B | – | 4.5% |
| International SegmentRevenue increased 7.1%, driven by a 15.0% increase in revenue per piece. GAAP operating profit was $746 M versus $676 M, and non-GAAP adjusted operating profit was $746 M versus $691 M. | $5.01B | – | 7.1% |
| Supply Chain SolutionsRevenue increased 18.2%, primarily due to growth in forwarding and logistics, including healthcare. GAAP operating profit was $92 M versus $525 M, while non-GAAP adjusted operating profit was $274 M versus $536 M. | $2.98B | – | 18.2% |
Fourth-quarter and full-year 2026 outlook
- RevenueFourth-quarter 2026 consolidated revenue of approximately $25.7 billion; full-year 2026 consolidated revenue of approximately $92.6 billion
- Tax rateEffective tax rate of approximately 23% for the full year 2026
- NoteFourth-quarter 2026 non-GAAP adjusted operating profit of approximately $3.3 billion
- NoteFull-year 2026 non-GAAP adjusted operating profit of approximately $8.75 billion
- NoteFull-year 2026 non-GAAP adjusted diluted EPS of approximately $7.28
- NoteFull-year 2026 non-GAAP adjusted free cash flow of approximately $6.1B
- NoteFull-year 2026 capital expenditures of approximately $3.0 billion
- NoteFull-year 2026 dividend payments of around $5.4 billion, subject to board approval
- NoteFull-year 2026 pension contributions of $1.3 billion
Capital returns
- Full-year 2026 dividend payments of around $5.4 billion, subject to board approval.
What drove it
- Consolidated revenue increased 6.7% to $22.9 billion, with growth across all segments.
- U.S. Domestic revenue growth was driven by a 6.1% increase in revenue per piece.
- International revenue growth was driven by a 15.0% increase in revenue per piece.
- Supply Chain Solutions revenue growth was primarily due to growth in forwarding and logistics, including healthcare.
- UPS stated that premium growth and greater network efficiency drove continued strengthening in business fundamentals.
- During the first nine months of 2026, UPS achieved approximately $1.8 billion of program benefits from Network Reconfiguration and Efficiency Reimagined initiatives and expects nearly $3 billion in full-year 2026 benefits.
Concerns
- Third-quarter GAAP operating margin was 7.6%, compared with 8.4%, and non-GAAP adjusted operating margin was 9.0%, compared with 10.0%.
- Third-quarter non-GAAP adjusted operating profit was $ 2,054 million, compared with $ 2,132 million.
- Supply Chain Solutions GAAP operating profit declined to $92 M from $525 M, and non-GAAP adjusted operating profit declined to $274 M from $536 M.
- Supply Chain Solutions recorded a $182 million goodwill impairment charge in the third quarter.
- Third-quarter GAAP results included a net charge of $279 million, or $0.32 per diluted share.
- Nine-month GAAP operating profit was $ 3,941 million versus $ 5,292 million, while nine-month non-GAAP adjusted operating profit was $ 5,478 million versus $ 5,771 million.
- Nine-month GAAP diluted EPS was $ 3.09 versus $ 4.46, while non-GAAP adjusted diluted EPS was $ 4.52 versus $ 4.78.
- UPS expects non-GAAP adjusted operating expense to exclude between $1.4 and $1.6 billion in costs for full-year 2026, primarily related to employee separation costs and third-party consulting fees.
What to watch
- Delivery against fourth-quarter 2026 revenue guidance of approximately $25.7 billion and non-GAAP adjusted operating profit guidance of approximately $3.3 billion.
- Delivery against full-year 2026 guidance for consolidated revenue of approximately $92.6 billion, non-GAAP adjusted operating profit of approximately $8.75 billion, non-GAAP adjusted diluted EPS of approximately $7.28 and non-GAAP adjusted free cash flow of approximately $6.1B.
- Execution of Network Reconfiguration and Efficiency Reimagined, which is not expected to conclude until the fourth quarter of 2027.
- The expected nearly $3 billion in full-year 2026 program benefits and the expected $1.4 to $1.6 billion of excluded full-year transformation-related costs.
- Supply Chain Solutions profitability following the third-quarter goodwill impairment charge and lower operating profit.
Balance sheet and cash flow
- Nine months ended September 30, 2026 cash flows from operating activities were $ 5,986 million, compared with $ 5,148 million.
- Nine months ended September 30, 2026 capital expenditures were (2,221) million, compared with (2,969) million.
- Nine months ended September 30, 2026 proceeds from disposals of property, plant and equipment were 473 million, compared with 585 million.
- Nine months ended September 30, 2026 other investing activities were (18) million, compared with (20) million.
- Nine months ended September 30, 2026 non-GAAP free cash flow was $ 4,220 million, compared with $ 2,744 million.
Analysis
UPS reported third-quarter 2026 consolidated revenue of $22.9 billion, up 6.7%, with growth in each reported business segment. U.S. Domestic revenue increased 4.5% to $14,865 M, International revenue increased 7.1% to $5,007 M, and Supply Chain Solutions revenue increased 18.2% to $2,981 M. Domestic and International revenue gains were driven by increases in revenue per piece of 6.1% and 15.0%, respectively, while Supply Chain Solutions growth was primarily attributed to forwarding and logistics, including healthcare.
Profitability remained below the prior-year quarter on both reported and adjusted measures. Consolidated GAAP operating profit was $ 1,744 million versus $ 1,804 million, and non-GAAP adjusted operating profit was $ 2,054 million versus $ 2,132 million. GAAP operating margin was 7.6% versus 8.4%, while non-GAAP adjusted operating margin was 9.0% versus 10.0%. GAAP diluted EPS was $ 1.37 versus $ 1.55 and non-GAAP adjusted diluted EPS was $ 1.69 versus $ 1.74.
The segment results show a divide between revenue growth and earnings conversion. U.S. Domestic GAAP operating profit increased to $906 M from $603 M, and adjusted operating profit increased to $1,034 M from $905 M. International GAAP operating profit rose to $746 M from $676 M, with adjusted operating profit rising to $746 M from $691 M. Supply Chain Solutions was the principal earnings drag: GAAP operating profit fell to $92 M from $525 M and adjusted operating profit fell to $274 M from $536 M. The segment recorded a $182 million goodwill impairment charge. Consolidated third-quarter results also included a net charge of $279 million, or $0.32 per diluted share, comprising after-tax transformation strategy costs, the goodwill impairment and a partially offset gain on the sale of MD-11 assets.
Cash generation improved over the first nine months. Cash flows from operating activities were $ 5,986 million versus $ 5,148 million, and non-GAAP free cash flow was $ 4,220 million versus $ 2,744 million. UPS reported approximately $1.8 billion of program benefits in the first nine months from Network Reconfiguration and Efficiency Reimagined and expects nearly $3 billion of full-year benefits. The company expects the related initiative to exclude between $1.4 and $1.6 billion in full-year 2026 costs from non-GAAP adjusted operating expense.
Management raised fourth-quarter and full-year financial guidance. UPS expects fourth-quarter revenue of approximately $25.7 billion and non-GAAP adjusted operating profit of approximately $3.3 billion. Full-year guidance calls for approximately $92.6 billion of consolidated revenue, approximately $8.75 billion of non-GAAP adjusted operating profit, approximately $7.28 of non-GAAP adjusted diluted EPS and approximately $6.1B of non-GAAP adjusted free cash flow. The release also confirms approximately $3.0 billion of capital expenditures, around $5.4 billion of dividend payments subject to board approval, an effective tax rate of approximately 23%, and $1.3 billion of pension contributions.
Management, verbatim
Our third-quarter results demonstrate the continued strengthening of our business fundamentals, driven by premium growth and greater network efficiency. As momentum builds, we are entering the holiday shipping season from a position of strength, with the most automated and efficient network in our history. Given the strength we see in the business, we are raising our full-year financial guidance.
Carol Tomé, UPS chief executive officer
Not in the filing
stated, not guessed- Prior-year quarterly consolidated revenue amount
- Prior-quarter comparisons for reported metrics
- Gross profit and gross margin
- Quarterly operating cash flow and quarterly free cash flow
- Cash balance
- Debt balance
- Share repurchases
- Quarterly dividend amount
- Full-year GAAP revenue, GAAP operating profit, GAAP EPS and GAAP free-cash-flow guidance
- Prior outlook figures needed to compare actual results with prior guidance
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
UPS filed a Form 8‑K reporting its third‑quarter 2026 results and updated guidance.
Ticker impact
UPS raised its Q4 2026 and full-year 2026 financial guidance, including revenue and EPS forecasts.
likely upside as market prices in raised guidance
Guidance lift signals improved performance, prompting investors to bid the stock higher.
Market effects
Logistics and transportation sector may see broader optimism.
U.S. markets could benefit from a major carrier's upbeat outlook.
Global supply chain participants may adjust forecasts upward.
Counterpoint
If guidance already priced in, the lift may be modest.
Key entities
- companyUPS
U.S. logistics and package delivery giant.
