Amazon Prime and UPS trucks are seen in a building in Washington, DC, USA on July 12, 2024.
Jakub Porzycki | Norfuto Gety pictures
shares United Part Service More than 15 % decreased on Thursday after the company issued instructions for twice the revenue for this year and said it was planning to reduce delivery operations AmazonHer largest agent, in more than half.
The shipping giant said in Fourth quarter profit report It “reached an agreement in principle with its largest customer to reduce its size by more than 50 % by the second half of 2026.”
At the same time, UPS said it is re -configuring its American network and launching the multi -year efficiency initiatives you expect will lead to savings of about one billion dollars.
In a call with investors, Carrol Tommy, CEO Tommy, said in a call with investors, but she is not the best customer of the company. “Its margin is very frightening for US local actions,” she added.
“We are making commercial and operational changes, as well as the constituent changes we have already made, we will put us on our way to become more profitable, flexible and differentiated growing in the best parts of the market,” Tommy said in a statement.
A spokesman for Amazon Kelly Nanteil told CNBC in a statement that UPS had requested a reduction in size “due to their operational needs.”
“We definitely respect their decision,” Nanteil said in a statement. “We will continue to partnership with them and many other transport companies to serve our customers.”
Amazon said before UPS announced that it had offered an increase of UPS sizes.
UPS expected 2025 revenues of $ 89 billion, a decrease in revenues of $ 91.1 billion in 2024. This is much less than the unanimous estimates of 2025 revenues of $ 94.88 billion, according to analysts who were surveyed by LSEG.
For the fourth quarter, UPS missed revenues, as it recorded $ 25.30 billion for $ 25.42 billion expected to a LSEG poll.
Amazon has long relied on a combination of major transportation companies for delivery, including UPS, FEDEX And the American mail service. But he reduced the number of packages sent through UPS and other transport companies in recent years as it seems to have more control over delivery operations.
Amazon has quickly built its logistical service empire since then 2013 vacation offer She left her packets to be cut off in the hands of external tankers. The company is now supervising thousands of delivery companies in the last mile that offer exclusive packages to Amazon, as well as a network at home of aircraft, trucks and ships. Through some estimates, Amazon's internal logistical operations I slept to competition Or bypassing the size of the main transport companies.
For its part, UPS has taken more aggressive measures to control costs, including providing food to the most profitable delivery customers. In inviting the investor, TOME has highlighted health care or small, international and commercial businesses to business, or B2B, as the “best parts in the market” that tend to a large extent. In the last quarters, UPS Benefit From the flow of volume from the retailers in TEMU and Shein deals, which quickly gained popularity in the United States
Last January, UPS Passing 12,000 employees As part of an attempt to achieve $ 1 billion of cost savings.
