UNITED PARCEL SERVICE INC
For the period ended Jun 30, 2026. Filed Aug 5, 2026.
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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.
Jun 30, 2026 · Filed Aug 5, 2026
Extracted filing text, with the paragraph anchors used by the comparison.
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Supply Chain Solutions Operations ("SCS")
SCS
| Three Months Ended June 30, · Change · Six Months Ended June 30, · Change | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2026 · 2025 · $ · % · 2026 · 2025 · $ · % | |||||||||||
| Revenue (in millions): | |||||||||||
| Forwarding | $791 | $732 | $59 | 8.1% | $1,447 | $1,458 | $(11) | (0.8)% | |||
| Logistics | 1,540 | 1,476 | 64 | 4.3% | 2,949 | 3,048 | (99) | (3.2)% | |||
| Other SCS | 529 | 445 | 84 | 18.9% | 1,001 | 860 | 141 | 16.4% | |||
| Total Revenue | $2,860 | $2,653 | $207 | 7.8% | $5,397 | $5,366 | $31 | 0.6% | |||
| Operating Expenses (in millions): | |||||||||||
| Operating Expenses | $2,569 | $2,419 | $150 | 6.2% | $4,901 | $5,086 | $(185) | (3.6)% | |||
| Non-GAAP Adjustments to Operating Expenses | |||||||||||
| Transformation Strategy Costs | — | 2 | (2) | (100.0)% | (1) | (11) | 10 | (90.9)% | |||
| Net (Loss) Gain on Divestiture | — | 20 | (20) | (100.0)% | — | (19) | 19 | (100.0)% | |||
| Non-GAAP Adjusted Operating Expenses | $2,569 | $2,441 | $128 | 5.2% | $4,900 | $5,056 | $(156) | (3.1)% | |||
| Operating Profit (in millions) and Operating Margin: | |||||||||||
| Operating Profit | $291 | $234 | $57 | 24.4% | $496 | $280 | $216 | 77.1% | |||
| Non-GAAP Adjusted Operating Profit | $291 | $212 | $79 | 37.3% | $497 | $310 | $187 | 60.3% | |||
| Operating Margin | 10.2% | 8.8% | 9.2% | 5.2% | |||||||
| Non-GAAP Adjusted Operating Margin | 10.2% | 8.0% | 9.2% | 5.8% | |||||||
| Currency Benefit / (Cost) – (in millions)(1): | |||||||||||
| Revenue | $45 | $80 | |||||||||
| Operating Expenses | (44) | (78) | |||||||||
| Operating Profit | $1 | $2 | |||||||||
| (1) Amount represents the change in currency translation compared to the prior year. | |||||||||||
Revenue
Revenue increased for the quarter from our Forwarding, Logistics and other SCS businesses. Revenue increased for the year-to-date period primarily due to an increase in revenue from our other SCS businesses, partially offset by declines in Forwarding and Logistics.
Within our Forwarding businesses, revenue increased $59 million for the quarter driven by higher international airfreight rates. For the year-to-date period, Forwarding revenue decreased by $11 million.
Within our Logistics businesses, revenue increased $64 million for the quarter (down $99 million year to date). This was primarily due to an increase of $232 million for the quarter (up $420 million year to date) from our healthcare logistics business as a result of our fourth quarter 2025 acquisition of AHG, as well as higher volume driven by additional healthcare logistics customer demand. These increases were offset by a decline in Mail Innovations of $186 million for the quarter (down $563 million year to date).
Revenue from our other businesses within SCS increased $84 million for the quarter (up $141 million year to date), primarily driven by growth within our digital businesses.
Total operating expenses increased for the quarter primarily due to the acquisition of AHG and higher volume from healthcare logistics customer demand, partially offset by the impact of the decline in Mail Innovations volume. On a year-to-date basis, operating expenses decreased due to the impact of Mail Innovations volume declines, partially offset by increases in healthcare logistics expenses from the acquisition of AHG and volume increases from customer demand.
Our non-GAAP adjusted operating expenses exclude the impact of transformation strategy costs of $0 and $2 million in the second quarters of 2026 and 2025, respectively, and $1 and $11 million in the 2026 and 2025 year-to-date periods, respectively. In 2025, non-GAAP adjusted operating expense for the quarter and year-to-date periods excluded the impact of a divestiture of a business within SCS.
Transformation strategy costs in SCS during the periods presented related to our Transformation 2.0, Fit to Serve, and Network Reconfigurationand Efficiency Reimagined programs. Within Transformation 2.0, we incurred costs related to financial system investments in 2025. Within Fit to Serve, we incurred severance costs in 2025. Within Network Reconfiguration and Efficiency Reimagined, we incurred costs related to end-to-end process redesign in both the 2026 and 2025 periods. See Supplemental Information - Items Affecting Comparability for additional discussion of items excluded from our non-GAAP adjusted financial measures.
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