United Parcel Service Inc (NYSE:UPS) reported fourth-quarter revenue and earnings above Wall Street expectations on Tuesday, buoyed by strong international performance even as domestic package demand softened.
The logistics giant posted revenue of $24.5 billion for the quarter, topping analysts’ estimate of $24 billion, despite a 3% year-over-year decline. Adjusted earnings per share came in at $2.38, exceeding the $2.20 forecast.
Operating profit for the quarter was $2.6 billion, or $2.9 billion on an adjusted basis, with an overall operating margin of 11.8%. International operations remained a bright spot, delivering a 17.5% operating margin on $5 billion in revenue.
In contrast, the US Domestic Package segment reported a lower 8.5% margin on $16.8 billion in revenue, reflecting softer demand. Supply Chain Solutions generated $2.7 billion in revenue with a 9.8% margin.
GAAP charges totaled $238 million, including a $137 million MD-11 aircraft write-off and $101 million in transformation costs.
For the full year 2026, UPS expects revenue of approximately $89.7 billion, surpassing the consensus estimate of $87.95 billion, with an adjusted operating margin target of 9.6%. Capital expenditures are projected at $3 billion, while dividend payments are expected to total around $5.4 billion. The company anticipates a tax rate of roughly 23%.
UPS CEO Carol Tomé said the company expects 2026 to mark an “inflection point” in executing its strategy. “Looking ahead, upon completion of the Amazon glide-down, 2026 will be an inflection point in the execution of our strategy to deliver growth and sustained margin expansion,” she said, referring to the gradual reduction of low-margin shipping volumes from Amazon.
Tomé added that 2025 had been “a year of considerable progress” for UPS, as the company strengthened revenue quality and modernized its network to better navigate shifts in global shipping demand.
Shares rose 2.6% in early Tuesday trading following the results.