UPS has announced significant steps to streamline its operations, including the reduction of approximately 20,000 jobs and the closure of over 70 facilities. This decision aligns with the company’s plan to significantly reduce the volume of packages it handles for Amazon.
The parcel delivery company revealed these plans on Tuesday, indicating that the job cuts are expected to occur this year. By the end of June, UPS aims to shut down 73 facilities, a mix of leased and owned properties. The company is currently assessing its network, with the possibility of identifying additional locations for closure.
CEO Carol Tomé emphasized the timeliness of these measures, stating in a Tuesday announcement, “The actions we are taking to reconfigure our network and reduce costs across our business could not be timelier. Although the macro environment remains uncertain, these steps will position us as a stronger and more agile UPS.”
In January, UPS disclosed an agreement with Amazon, its largest customer, to reduce the shipping volume by over 50% by the latter half of 2026. During a fourth-quarter earnings call the same month, Tomé mentioned that the company had been collaborating with Amazon for nearly three decades and used this contract renewal as a chance to reevaluate the partnership.
“While Amazon is our largest customer, it does not provide the most profitable returns,” Tomé noted. “Its business significantly dilutes our domestic profit margins.” Ultimately, UPS decided that reducing the volume handled for Amazon was the most advantageous option.
UPS currently employs roughly 490,000 workers. The company also announced its financial results for the first quarter, ending March 31. The Atlanta-based firm reported earnings of $1.19 billion, or $1.40 per share. When excluding certain items, earnings reached $1.49 per share, exceeding the $1.44 per share predicted by analysts surveyed by Zacks Investment Research.
UPS reported total revenue of $21.55 billion, surpassing Wall Street’s expectation of $21.06 billion. Despite the uncertain economic climate, UPS refrained from updating its previously announced full-year forecast. The company had initially projected 2025 revenues to reach approximately $89 billion.
Following the announcements, UPS shares experienced a slight increase in morning trading.