UPS Exceeds Expectations with $22.2 Billion in Q3 2024 Revenue
United Parcel Service, Inc. (NYSE: UPS) reported its third-quarter 2024 results, showcasing a significant recovery from previous periods. The company’s consolidated revenues reached $22.2 billion, marking a 5.6% increase from the same quarter in 2023. This growth was driven by improvements across various business segments, including U.S. Domestic, International, and Supply Chain Solutions.
Consolidated operating profit surged to $2.0 billion, representing a 47.8% increase from the prior year. On a non-GAAP adjusted basis, the operating profit rose by 22.8%, highlighting the company’s focus on operational efficiency and strategic growth initiatives.
Diluted earnings per share (EPS) for the quarter stood at $1.80, with a non-GAAP adjusted EPS of $1.76, reflecting a 12.1% increase from the third quarter of 2023. This performance was bolstered by a $152 million gain from the divestiture of the Coyote Logistics business, offset by transformation strategy costs.
CEO Carol Tomé emphasized the company’s return to revenue and profit growth after a challenging 18-month period, expressing readiness for the upcoming peak season and continued progress.
UPS Beats Market Expectations in Third Quarter of 2024
UPS’s third-quarter results exceeded market expectations, which had projected an EPS of $1.63 and revenues of $22.08 billion. The actual EPS of $1.80 and revenues of $22.2 billion surpassed these forecasts, underscoring the company’s strong operational performance and effective cost management strategies.
This outperformance was primarily driven by increased average daily volume in the U.S. Domestic segment and a rise in revenue per piece in the International segment.
The U.S. Domestic segment reported a 5.8% increase in revenue, attributed to a 6.5% increase in average daily volume. The operating margin for this segment was 6.2%, with a non-GAAP adjusted operating margin of 6.7%.
The International segment also showed positive results, with a 3.4% revenue increase and an operating margin of 18.1%. In the Supply Chain Solutions segment, revenue grew by 8.0%, driven by air and ocean forwarding growth. The segment’s operating margin was 8.5%, with a non-GAAP adjusted operating margin of 6.4%.
UPS Updates Full Year 2024 Guidance
UPS has updated its financial guidance for the full year 2024, factoring in the completed divestiture of Coyote Logistics and the third-quarter results. The company now expects consolidated revenue to be approximately $91.1 billion, reflecting its optimistic outlook for the remainder of the year.
Additionally, UPS has revised its non-GAAP adjusted operating margin expectation to approximately 9.6%, indicating a focus on maintaining profitability through strategic initiatives.
Capital expenditures for the year are projected to be around $4.0 billion, with dividend payments expected to reach approximately $5.4 billion, subject to board approval. UPS remains committed to its strategic priorities, focusing on customer service, employee engagement, and innovation.
The company anticipates a successful holiday season and is well-prepared to meet the demands of peak shipping periods, leveraging its extensive logistics network and operational capabilities.
Disclaimer: The author does not hold or have a position in any securities discussed in the article.
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