UNITED PARCEL SERVICE INC

Our primary (uses) sources of cash from investing activities were as follows (in millions):

For the nine months ended September 30, 2026, total capital expenditures decreased, primarily driven by reduced spending on buildings, facilities and plant equipment, lower technology infrastructure spending as a result of prior-year project completions and non-recurring investments, reduced spending on vehicles due to lower package volume and a focus on routine replacements for vehicles at the end of their useful lives and decreased aircraft expenditures due to aircraft deliveries under finance lease arrangements. These decreases were partially offset as we continued to invest in our Network of the Future and other operational efficiency initiatives.

Proceeds from the disposal of businesses, property, plant and equipment also decreased. During the nine months ended September 30, 2026 and 2025, proceeds were $473 million and $585 million, respectively. For additional information see note 5 to the unaudited consolidated financial statements.

Cash paid for acquisitions in the nine months ended September 30, 2026 was attributable to reacquired development area rights for The UPS Store. In the nine months ended September 30, 2025, cash paid for acquisitions of $479 million was primarily related to the acquisition of Frigo-Trans and Biotech & Pharma Logistics ("Frigo-Trans") and reacquired development area rights for The UPS Store.

Non-cash investing activities for the nine months ended September 30, 2026 and 2025 included $98 and $64 million, respectively, of construction-in-progress related to the capitalization of construction costs in connection with a build-to-suit financing obligation.

We have commitments for the purchase of equipment, real estate and vehicles to provide for the replacement and enhancement of existing capacity and targeted growth. These investments also provide for maintenance of buildings, facilities and equipment. Our 2026 investment program anticipates investments in technology initiatives and enhanced network capabilities. We expect our capital expenditures will be approximately $3.0 billion for the full year of 2026, of which approximately 80% will be allocated to network enhancement projects and other technology initiatives. We regularly evaluate opportunities for cost effective financing of assets in order to reduce our capital spending. Future capital spending will depend on a variety of factors, including economic and industry conditions, business strategy and financing alternatives.