UNITED PARCEL SERVICE INC

Our primary (uses) sources of cash from financing activities were as follows (in millions, except per share data):

(1)For additional information on our share repurchase activities, see note 11 to the unaudited consolidated financial statements.

(2)Includes issuances of common stock.

We did not repurchase any shares under our stock repurchase program during the nine months ended September 30, 2026.

The declaration of dividends is subject to the discretion of the Board and depends on various factors, including our net income, financial condition, cash requirements, future prospects and other relevant factors. We paid a quarterly cash dividend of $1.64 per share in 2026 and 2025.

Issuances of debt during the nine months ended September 30, 2026 consisted of fixed-rate and floating-rate senior notes of varying maturities totaling $1.3 billion. A portion of the fixed-rate senior notes was contributed directly to our company-sponsored pension plans as a noncash financing activity, resulting in financing cash proceeds from debt issuances of $870 million. See note 6 and note 9 to the unaudited consolidated financial statements for additional information. Repayments of debt during the nine months ended September 30, 2026 consisted of $133 million of senior notes and finance lease obligations. Issuances of debt during the nine months ended September 30, 2025 consisted of fixed-rate and floating-rate senior notes of varying maturities totaling $4.2 billion. Repayments of debt during the nine months ended September 30, 2025 consisted of $1.1 billion of senior notes and finance lease obligations.

The amount of commercial paper outstanding fluctuates based on daily liquidity needs. As of September 30, 2026, we had no outstanding balances under our U.S. or European commercial paper programs. The average balance outstanding of commercial paper during the nine months ended September 30, 2026 and 2025 was $47 and $63 million, respectively, and the average interest rates were 3.49% and 4.01%, respectively. The amount of commercial paper outstanding under these programs in the remainder of 2026 is expected to fluctuate. As of September 30, 2026, we had $500 million of fixed-rate senior notes currently outstanding that mature in 2026. We intend to repay these amounts when due. We consider the overall fixed and floating interest rate mix of our portfolio and the related overall cost of borrowing when planning for future issuances and non-scheduled repayments of debt.

Cash flows from other financing activities included cash proceeds of $62 million related to collections from customers on accounts receivable that had been factored in 2026. This reflected $121 million of obligations related to factored receivables that were not remitted to third-party purchasers as of September 30, 2026, partially offset by $59 million repaid from prior-period balances. This program began in third quarter of 2025.

As of September 30, 2026, we had parent company guarantees of approximately $1.8 billion related to aircraft leases. For additional information on guarantees, see note 9 to the unaudited consolidated financial statements.

Except as disclosed above and in our Annual Report on Form 10-K for the year ended December 31, 2025, we do not have off-balance sheet financing arrangements, including variable interest entities, which we believe could have a material impact on our financial condition or liquidity.