Yahoo Finance

• Fourth Quarter Revenue: $25.3 billion, an increase of 1.5% year-over-year.

• Fourth Quarter Operating Profit: $3.1 billion, an increase of 11.2% year-over-year.

• Fourth Quarter Operating Margin: 12.3%, an increase of 110 basis points year-over-year.

• Diluted Earnings Per Share (Q4): $2.75, up 11.3% year-over-year.

• Full Year 2024 Revenue: $91.1 billion, slightly above last year.

• Full Year 2024 Operating Profit: $8.9 billion.

• Full Year 2024 Operating Margin: 9.8%.

• Cash from Operations (2024): $10.1 billion.

• Shareholder Returns (2024): $5.9 billion in dividends and share repurchases.

• US Domestic Operating Margin (Q4): 10.1%, an increase of 80 basis points year-over-year.

• International Segment Operating Margin (Q4): 21.6%, an increase of 210 basis points year-over-year.

• Supply Chain Solutions Operating Margin (Q4): 9.3%, an increase of 20 basis points year-over-year.

• Global DAP Revenue (2024): $3.3 billion, a 17% increase year-over-year.

• SMB Penetration (2024): 28.9% of total US volume, an increase of 30 basis points from last year.

• Capital Expenditures (2024): $3.9 billion.

• Debt Repayment (2024): $3.8 billion.

• Share Buybacks (2024): $500 million.

• Warning! GuruFocus has detected 8 Warning Sign with DGX.

Release Date: January 30, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• United Parcel Service Inc (NYSE:UPS) achieved a 1.5% increase in consolidated fourth-quarter revenue to $25.3 billion, with an 11.2% rise in operating profit, surpassing expectations.

• The company maintained its industry leadership in on-time service during the peak season for the seventh consecutive year, demonstrating strong operational efficiency.

• UPS's Digital Access Program (DAP) generated $3.3 billion in global revenue, marking a 17% year-over-year increase, contributing to the growth in US SMB penetration.

• The acquisition of Frigo-Trans and the opening of healthcare cross-dock facilities in Europe expanded UPS's cold chain capabilities, supporting growth in the healthcare logistics market.

• UPS's strategic initiatives, including Efficiency Reimagined, are expected to drive approximately $1 billion in savings, enhancing profitability and operational agility.

Negative Points

• UPS faces challenges in the US small package market, which is experiencing slow growth and changing package characteristics, potentially impacting future returns.

• The company is significantly reducing its volume with its largest customer, Amazon, by more than 50% by the second half of 2026, which could lead to lower revenue in the near term.

• UPS's reliance on USPS for its SurePost product is at risk due to changes in USPS's operating model, prompting UPS to in-source this product, which may affect service and costs.

• The prolonged labor negotiation with the Teamsters in 2023 caused volume and earnings disruption, highlighting potential labor-related risks.

• UPS's 2025 revenue is expected to decline by 2.3% year-over-year, driven by an 8.5% reduction in average daily volume, indicating potential challenges in maintaining growth momentum.