UPS shares a tank after a weak guide, plans to cut Amazon deliveries

Actions of United plot service More than 15% fell on Thursday after the company issued a weak income guide for the year and said it planned to reduce deliveries to AmazonYour biggest customer, by more than half.

The shipping giant said in Your Fourth Quarter Income Report that “reached an agreement in principle with its largest client to reduce its volume by more than 50% in the second half of 2026”.

At the same time, UPS said it is reconfiguring its US network. And the launch of several -year efficiency initiatives that wait results in savings of approximately $ 1 billion.

The UPS CEO, Carol Take, said in a call with the investors that Amazon is the largest customer of UPS, but it is not the most profitable customer of the company. “His margin is very dilutive for the national business of the United States,” he added.

“We are making commercial and operational changes that, together with the fundamental changes that we have already made, will put us more on the way to become a more profitable, agile and differentiated UPS that is growing in the best parts of the market,” he took in A statement.

Amazon spokeswoman Kelly Nantel told CNBC in a statement that UPS had requested a reduction in volume “due to their operational needs.”

“We certainly respect your decision,” Nantel said in a statement. “We will continue to associate with them and many other carriers to serve our customers.”

Amazon said before the UPS announcement that he had offered to increase UPS volumes.

UPS forecasts income 2025 of $ 89 billion, below the revenues of $ 91.1 billion in 2024. That is well below consensus estimates for revenues of 2025 of $ 94.88 billion, according to analysts surveyed by LSE.

For the fourth quarter, UPS lost income, informing $ 25.30 billion versus $ 25.42 billion early analysts in a survey conducted by LSEG.

Amazon has long trusted a mixture of main operators for deliveries, including UPS, Fedex and the postal service of the United States. But the number of packages sent through UPS and other operators in recent years has decreased, since it seems to have more control over deliveries.

Amazon has quickly accumulated its own logistics empire since A 2013 holiday fiasco He left his packages stranded in the hands of external carriers. The company now supervises thousands of last mile delivery companies that deliver packages exclusively for Amazon, as well as an internal network of airplanes, trucks and ships. According to some estimates, Amazon’s internal logistics operations They have come to rival or exceed the size of the main carriers.

UPS, meanwhile, has taken more aggressive cost control measures, including more profitable delivery customers. In the investor call, Tome highlighted medical attention, small businesses, international and business, or B2B, such as “the best parts of the market” in which it has been inclined more. In the last quarters, UPS It has benefited of an influx of volume of retail retail and Shein, who have quickly gained popularity in the United States

Last January, UPS fired 12,000 employees As part of an offer to make $ 1 billion in cost savings.