UNITED PARCEL SERVICE INC
For the period ended Sep 30, 2025. Filed Nov 5, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 5, 2025
Extracted filing text, with the paragraph anchors used by the comparison.
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Supply Chain Solutions Operations
Supply Chain Solutions ("SCS")
| Three Months Ended September 30, · Change · Nine Months Ended September 30, · Change | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 · 2024 · $ · % · 2025 · 2024 · $ · % | |||||||||||||
| Revenue (in millions): | |||||||||||||
| Forwarding | $730 | $1,307 | $(577) | (44.1)% | $2,188 | $3,902 | $(1,714) | (43.9)% | |||||
| Logistics | 1,363 | 1,550 | (187) | (12.1)% | 4,411 | 4,638 | (227) | (4.9)% | |||||
| Other SCS | 429 | 380 | 49 | 12.9% | 1,289 | 1,128 | 161 | 14.3% | |||||
| Total Revenue | $2,522 | $3,237 | $(715) | (22.1)% | $7,888 | $9,668 | $(1,780) | (18.4)% | |||||
| Operating Expenses (in millions): | |||||||||||||
| Operating Expenses | $1,997 | $2,893 | $(896) | (31.0)% | $7,083 | $8,962 | $(1,879) | (21.0)% | |||||
| Non-GAAP Adjustments to Operating Expenses | |||||||||||||
| Transformation Strategy Costs | (11) | (84) | 73 | (86.9)% | (22) | (98) | 76 | (77.6)% | |||||
| Gain on Divestiture | — | 156 | (156) | (100.0)% | 20 | 156 | (136) | (87.2)% | |||||
| Goodwill and Asset Impairment Charges | — | — | — | N/A | (39) | (41) | 2 | (4.9)% | |||||
| Expense for Regulatory Matter | — | — | — | N/A | — | (45) | 45 | (100.0)% | |||||
| Non-GAAP Adjusted Operating Expenses | $1,986 | $2,965 | $(979) | (33.0)% | $7,042 | $8,934 | $(1,892) | (21.2)% | |||||
| Operating Profit (in millions) and Operating Margin: | |||||||||||||
| Operating Profit | $525 | $344 | $181 | 52.6% | $805 | $706 | $99 | 14.0% | |||||
| Non-GAAP Adjusted Operating Profit | $536 | $272 | $264 | 97.1% | $846 | $734 | $112 | 15.3% | |||||
| Operating Margin | 20.8% | 10.6% | 10.2% | 7.3% | |||||||||
| Non-GAAP Adjusted Operating Margin | 21.3% | 8.4% | 10.7% | 7.6% | |||||||||
| Currency Benefit / (Cost) – (in millions)(1): | |||||||||||||
| Revenue | $30 | $6 | |||||||||||
| Operating Expenses | (31) | 1 | |||||||||||
| Operating Profit | $(1) | $7 | |||||||||||
| (1) Amount represents the change in currency translation compared to the prior year. | |||||||||||||
| Three Months Ended September 30, · Change · Nine Months Ended September 30, · Change | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 · 2024 · $ · 2025 · 2024 · $ | ||||||||||||
| Non-GAAP Adjustments to Operating Expenses (in millions): | ||||||||||||
| Transformation Strategy Costs | ||||||||||||
| Forwarding | $8 | $28 | $(20) | $23 | $35 | $(12) | ||||||
| Logistics | 3 | 56 | (53) | (1) | 63 | (64) | ||||||
| Total Transformation Strategy Costs | $11 | $84 | $(73) | $22 | $98 | $(76) | ||||||
| Gain on Divestiture | ||||||||||||
| Forwarding | $— | $(156) | $156 | $— | $(156) | $156 | ||||||
| Other SCS | — | — | — | (20) | — | (20) | ||||||
| Total Gain on Divestiture | $— | $(156) | $156 | $(20) | $(156) | $136 | ||||||
| Goodwill and Asset Impairment Charges | ||||||||||||
| Logistics | $— | $— | $— | $— | $41 | $(41) | ||||||
| Other SCS | — | — | — | 39 | — | 39 | ||||||
| Total Goodwill and Asset Impairment Charges | $— | $— | $— | $39 | $41 | $(2) | ||||||
| Expense for Regulatory Matter | ||||||||||||
| Other SCS | $— | $— | $— | $— | $45 | $(45) | ||||||
| Total Expense for Regulatory Matter | $— | $— | $— | $— | $45 | $(45) | ||||||
| Total non-GAAP Adjustments to Operating Expenses | $11 | $(72) | $83 | $41 | $28 | $13 | ||||||
Revenue
Total revenue in Supply Chain Solutions decreased for both the quarter and year-to-date periods primarily due to a decline in Forwarding and Logistics revenue, partially offset by a revenue increase in our other businesses.
Within our Forwarding businesses, revenue decreased $577 million (down $1.7 billion year to date), primarily driven by the impact of the third quarter 2024 divestiture of Coyote, which contributed $465 million of revenue in the 2024 third quarter ($1.6 billion in the 2024 year-to-date period). Revenue within our other Forwarding businesses also declined by a total of $110 million (down $146 million year to date), primarily driven by demand softness from changing trade policies and tariff uncertainty, particularly on the China-to-U.S. trade lane, which also negatively impacted both volume and rates.
Within our Logistics businesses, revenue decreased $187 million (down $227 million year to date). Revenue in our Mail Innovations business decreased $316 million (down $370 million year to date), driven by volume declines resulting from our initiatives to improve revenue quality. The declines in Mail Innovations revenue were partially offset by $118 million of revenue increases in our healthcare logistics business (up $147 million year to date), due to our January 2025 acquisition of Frigo-Trans and year-over-year growth in other healthcare businesses.
Revenue from our other businesses within Supply Chain Solutions increased $49 million for the quarter (up $161 million year to date) primarily driven by volume growth in both Roadie as well as UPS Capital within our digital businesses, which increased $50 million for the quarter (up $159 million year to date).
Total operating expenses and non-GAAP adjusted operating expenses within Supply Chain Solutions decreased for both the quarter and year-to-date periods driven primarily by the divestiture of Coyote of $468 million (down $1.6 billion year to date), sale-leaseback transactions involving real estate properties within Supply Chain Solutions of $330 million and volume declines and lower purchased transportation costs in our Mail Innovations business.
Non-GAAP adjusted operating expenses exclude the impact of transformation strategy costs, which were $11 and $84 million in the third quarters of 2025 and 2024, respectively, and $22 and $98 million in the 2025 and 2024 year-to-date periods, respectively. The 2025 year-to-date period also excludes a $20 million gain on divestiture and a $39 million impairment charge. The 2024 quarter and year-to-date periods exclude a $156 million gain related to the divestiture of Coyote. The 2024 year-to-date period also excludes a $41 million write-down related to certain trade names and a $45 million expense related to a regulatory matter.
Transformation strategy costs reflected within Supply Chain Solutions during the quarters and year-to-date periods are related to our Fit to Serve, Transformation 2.0 and Network Reconfigurationand Efficiency Reimagined programs. Within Transformation 2.0, we incurred costs related to financial system investments during both periods. Within Fit to Serve, we incurred severance costs in both the third quarter and year-to-date periods of 2025 and 2024. Within Efficiency Reimagined, we incurred costs related to end-to-end process redesign. See Supplemental Information - Items Affecting Comparability for additional discussion of items excluded from our non-GAAP adjusted financial measures.
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