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what it is
UPS moves packages by air and truck for homes and businesses in more than 220 countries.
how it gets paid
FY 2025 consolidated revenue was $88.7B (UPS Jan 27, 2026). Segment mix in the filing tables maps to roughly U.S. Domestic ~$58.6B, International ~$17.7B, and Supply Chain & Freight ~$12.4B—check the 10-K segment footnotes for exact definitions.
why growth slowed
Revenue fell 2.6% last year. Revenue per piece jumped 8.3%, marking the strongest fourth-quarter growth in four years and more than offsetting a 10.8% drop in average daily volume, driven.
what just happened
Q4 2025: GAAP diluted EPS was $2.10 (including charges); non-GAAP adjusted diluted EPS was $2.38. Consolidated Q4 revenue was $24.5B.
At a glance
A balance sheet — strong enough to weather a downturn
70/100 earnings predictability — reasonably predictable
~16.8x trailing P/E on FY2025 GAAP EPS $6.56 (price moves daily)
6.1% dividend yield — cash in your pocket every quarter
21.5% return on capital — every dollar works hard here
xvary composite: 74/100 — average
What they do
UPS moves packages by air and truck for homes and businesses in more than 220 countries.
UPS runs 534 planes and 128,000 ground vehicles with about 490,000 employees. That is a bigger machine than most rivals can copy. More than 75% of the workforce is unionized, so your package rides a system, not a weekend project.
How they make money
$88.7B
annual revenue · their business grew -2.6% last year
Domestic Package
$58.6B
International Package
$17.7B
Supply Chain & Freight
$12.4B
The products that matter
u.s. ground and air parcel delivery
Domestic Package Operations
$58.5B · 66% of sales
it's the $58.5B core engine and 66% of total revenue. when domestic volume or pricing moves, the whole stock feels it.
the core
cross-border parcel and freight delivery
International Package Operations
~$17.7B · ~20% of FY sales
International Package is roughly $17.7B in the FY segment view—material, but U.S. Domestic still sets the tone.
diversifier
freight forwarding and logistics
Supply Chain Solutions
not separately broken out here
this business expands UPS beyond basic parcel delivery, but the snapshot does not break out its revenue inside the $88.7B total. when disclosure is thin, you should assume parcel economics still drive the story.
watch disclosure
Key numbers
$88.7B
revenue
That is the size of the machine before you argue about margins.
6.1%
dividend yield
You get paid 6.1% a year while revenue is down 2.6%.
8.9%
GAAP op. margin FY25
FY 2025 consolidated operating margin was 8.9% GAAP; non-GAAP adjusted was 9.8% (UPS Jan 27, 2026 release)—do not confuse with Q4-only margins.
21.5%
return on capital
For every $100 invested in the business, UPS earns $21.50 before financing.
Financial health
A
strength
- balance sheet grade A — very strong financial position
- risk rank 3 — safer than 50% of stocks
- price stability 70 / 100
- long-term debt $23.5B (20% of capital)
- net profit margin 8.3% — keeps 8 cents of every dollar in revenue
- return on equity 38% — $0.38 profit for every $1 investors have put in
A — among the top-rated companies for balance sheet quality.
Total return vs. market
You invested $10,000 in UPS 3 years ago → it's now worth $6,710.
The index would have given you $13,880.
source: institutional data · total return
What just happened
Q4 + FY 2025 · Jan 27, 2026
Q4 2025: $24.5B revenue · GAAP EPS $2.10 · adjusted EPS $2.38
Source: UPS investor release (Jan 27, 2026). GAAP EPS included ~$238M of charges (~$0.28/share). FY 2025 revenue $88.7B; GAAP diluted EPS $6.56; adjusted diluted EPS $7.16.
$24.5B
Q4 revenue
$2.10 / $2.38
GAAP / adj. EPS
10.5%
Q4 GAAP op. margin
the reconciliation
Street headlines often use adjusted Q4 EPS ($2.38) while GAAP prints lower ($2.10)—both are in the release; know which one you are tracking.
-
revenue per piece jumped 8.3%, marking the strongest fourth-quarter growth in four years and more than offsetting a 10.8% drop in average daily volume, driven largely by the deliberate exit from low-margin amazon business.
-
non-GAAP adjusted diluted EPS was $2.38 for Q4 2025 vs. GAAP $2.10—compare either figure to the consensus feed you trust.
-
small- and medium-sized business penetration reached a record 31.2% of u.s. volume, while the business-to-business mix climbed to 37.5%, the highest holiday-quarter reading in six years.
-
the network is shrinking, by design.management plans to shed another million amazon packages per day in 2026, completing an 18-month exit that will have halved volumes from its largest customer.
-
to align costs, ups expects to cut up to 30,000 operational positions through attrition and a voluntary driver separation program, close at least 24 additional buildings in the first half, and push automation to 68% of u.s. volume by year-end.the company also retired its md-11 freighter fleet after a fatal crash, taking a $137 million write-off and leasing 767 capacity as replacements arrive.
source: UPS Q4/FY 2025 earnings release (Jan 27, 2026) · about.ups.com / investors.ups.com
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What could go wrong
the #1 risk is domestic package weakness during an intentional network reset.
high
domestic volume stays soft
Domestic Package Operations are $58.5B, or 66% of sales. if consumer and business shipping stays weak, the core engine keeps dragging on results.
66% of the revenue base is tied to this segment
high
cost cuts fail to offset lower volume
management plans to eliminate up to 30,000 operational positions. if service slips or savings arrive late, the turnaround loses credibility fast.
execution now sits at the center of the equity story
med
amazon exit creates a volume hole
UPS expects another 1 million amazon packages per day to disappear in 2026, finishing an 18-month reduction. the strategy can improve mix, but replacement demand has to fill the gap.
fewer low-quality packages help only if pricing and smb gains hold
med
margin pressure during fleet transition
last-quarter net margin was 5.5%, and the company already took a $137M write-off tied to the md-11 retirement. when margins are this thin, transition costs matter.
small operating misses can have outsized profit impact
a slowdown would hit the $58.5B domestic business first, and that's 66% of the company's $88.7B revenue.
source: institutional data · regulatory filings · risk analysis
Pay attention to
trend
revenue per piece
8.3% growth was the best fourth-quarter pricing signal in four years. if that fades, UPS loses a key offset to weak volume.
metric
small business mix
small and medium-sized business penetration hit 31.2% of u.s. volume. you want that number going up, not stalling.
risk
domestic package demand
with $58.5B in domestic revenue, even modest softness matters. watch the core before you watch the headline.
calendar
2026 network reset milestones
another 1 million amazon packages per day are expected to come out while up to 30,000 jobs are cut. the timeline matters as much as the target.
Analyst rankings
short-term outlook
top 20%
momentum score 2 — analysts expect above-average price performance in the year ahead. in human-speak, they think the reset might finally start showing up in the stock.
risk profile
average
stability score 3 — this is not a bunker stock, but it is not a chaos name either.
chart momentum
below average
technical score 4 — the chart still wants proof before it believes the turnaround.
earnings predictability
70 / 100
earnings are reasonably stable, but the current reset leaves more room for surprises than investors usually want from a dividend stock.
source: institutional data
Institutional activity
institutions have been net selling for 2 consecutive quarters — 867 buyers vs. 1,093 sellers in 3q2025. total institutional holdings: 0.5B shares. net selling for 2 quarters.
source: institutional data
Price targets
3-5 year target range
$87
$154
$110
current price
$121
target midpoint · +10% from current · 3-5yr high: $190 (+70% · 18% ann'l return)
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