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UPS Beats Third-Quarter Estimates and Lifts 2026 Revenue Outlook to About $92.6 Billion

UPS posted adjusted EPS of $1.69 on revenue of $22.9 billion, up 6.7%, and raised its full-year outlook for revenue, adjusted operating profit, EPS and free cash flow.

Oct 27, 2026 - 07:14

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United Parcel Service reported third-quarter results before the opening bell on Tuesday, October 27, 2026, that topped Wall Street forecasts, and the company raised its full-year financial outlook. Consolidated revenue rose 6.7% to $22.9 billion, with growth in every segment, and non-GAAP adjusted earnings came to $1.69 per diluted share, according to the company's earnings release.

Analysts surveyed by LSEG had expected adjusted earnings of $1.63 per share on revenue of $22.29 billion, CNBC reported. UPS shares traded about 1.3% higher in premarket dealings after the release, according to CNBC's live markets coverage.

Profit and one-time items

On a GAAP basis, UPS earned $1.16 billion, or $1.37 per diluted share, compared with $1.31 billion, or $1.55 per share, a year earlier. Consolidated operating profit was $1.74 billion, for an operating margin of 7.6%, while non-GAAP adjusted operating profit was $2.05 billion, a 9.0% margin, down from 10.0% in the third quarter of 2025.

GAAP results included a net charge of $279 million, or 32 cents per share. That figure consisted of $130 million in after-tax transformation strategy costs and a $182 million goodwill impairment in Supply Chain Solutions, partly offset by a $33 million gain on the sale of MD-11 aircraft assets. The prior-year quarter included a $330 million pre-tax gain from a sale-leaseback transaction, equal to 30 cents per share, the company said.

Segment results

U.S. Domestic: Revenue rose 4.5% to $14.87 billion, driven by a 6.1% increase in revenue per piece. Operating profit was $906 million, or $1.03 billion on an adjusted basis, for an adjusted margin of 7.0%.
International: Revenue increased 7.1% to $5.01 billion on a 15.0% rise in revenue per piece. Operating profit was $746 million on both a GAAP and adjusted basis, a 14.9% margin.
Supply Chain Solutions: Revenue climbed 18.2% to $2.98 billion, primarily on growth in forwarding and logistics, including healthcare. GAAP operating profit fell to $92 million from $525 million, and adjusted operating profit was $274 million, a 9.2% margin.

Average daily U.S. domestic package volume fell to 15.62 million pieces from 16.15 million a year earlier, according to the release's cost-per-piece reconciliation. The company had previously said it expected third-quarter domestic revenue to be flat and domestic average daily volume to fall because of seasonal declines and its planned reduction in volume from Amazon, CNBC noted. Adjusted domestic cost per piece rose 5.5% to $13.32.

Guidance raised again

For the fourth quarter, UPS now expects consolidated revenue of about $25.7 billion and non-GAAP adjusted operating profit of about $3.3 billion. For the full year, it forecast:

Consolidated revenue of about $92.6 billion, up from a previous expectation of $91.2 billion, according to CNBC
Non-GAAP adjusted operating profit of about $8.75 billion
Non-GAAP adjusted diluted EPS of about $7.28
Non-GAAP adjusted free cash flow of about $6.1 billion

The company reaffirmed 2026 capital expenditures of about $3.0 billion, dividend payments of around $5.4 billion subject to board approval, an effective tax rate of about 23% and $1.3 billion in pension contributions. CNBC said it was the second consecutive quarter in which UPS lifted its full-year guidance.

"Our third-quarter results demonstrate the continued strengthening of our business fundamentals, driven by premium growth and greater network efficiency," Chief Executive Carol TomÃ© said in the release. "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."

Cash flow and restructuring

Free cash flow for the first nine months of 2026 was $4.22 billion, compared with $2.74 billion a year earlier, as cash from operations rose to $5.99 billion and capital spending fell to $2.22 billion. Through its network reconfiguration and efficiency programs, UPS said it reduced its operational workforce, closed certain daily operations at buildings and achieved about $1.8 billion of program benefits in the first nine months, with nearly $3 billion expected for the full year.

The company expects to exclude $1.4 billion to $1.6 billion of related costs from adjusted operating expenses in 2026, including $1.2 billion tied to its Driver Choice Program. UPS said the planned volume reductions from its largest customer were completed in the second quarter of 2026, while its Efficiency Reimagined initiative is not expected to conclude until the fourth quarter of 2027.

Earnings-season context

UPS was among a heavy slate of companies reporting on Tuesday, alongside Coca-Cola, Boeing and PayPal, Reuters reported, with U.S. stock index futures little changed ahead of the Federal Reserve's policy decision on Wednesday. Chief Executive Carol TomÃ© and Chief Financial Officer Brian Dykes were scheduled to discuss the results on a conference call at 8:30 a.m. ET.