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UPS FY2026 Q2 RAISED

United Parcel Service, Inc. earnings call

Jul 28, 2026 · 08:30 ET Brian DykesCarol TomeP. J. Guido
Buzzberg read

Raising full-year 2026 guidance

UPS reported strong Q2 2026 results, successfully completing its Amazon volume reduction and network reconfiguration. Management raised full-year guidance, citing structural cost improvements, automation gains, and a focus on premium segments like SMB and healthcare. The only cross-company signal was continued de-risking from Amazon, now 9% of revenue. Q2 revenue $22.8B (+7.6% YoY), EPS $1.76; U.S. domestic operating profit +21% YoY to $1.2B.

Buzzberg read Raising full-year 2026 guidance UPS reported strong Q2 2026 results, successfully completing its Amazon volume reduction and network reconfiguration. Management raised full-year guidance, citing structural cost improvements, automation gains, and a focus on premium segments like SMB and healthcare. The only cross-company signal was continued de-risking from Amazon, now 9% of revenue. Q2 revenue $22.8B (+7.6% YoY), EPS $1.76; U.S. domestic operating profit +21% YoY to $1.2B. Read full analysisCollapse analysis

UPS reported strong Q2 2026 results, successfully completing its Amazon volume reduction and network reconfiguration. Management raised full-year guidance, citing structural cost improvements, automation gains, and a focus on premium segments like SMB and healthcare. The only cross-company signal was continued de-risking from Amazon, now 9% of revenue. Q2 revenue $22.8B (+7.6% YoY), EPS $1.76; U.S. domestic operating profit +21% YoY to $1.2B.

  • Amazon volume reduced to ~9% of total revenue, down from >13% peak; partnership remains but dependency lowered.
  • Raised FY2026 guidance: revenue ~$91.2B, operating profit ~$8.65B, EPS ~$7.22; U.S. domestic margin ~7.5%.
  • 68.5% of U.S. volume now flows through automated hubs (28% lower cost per piece); $3B in 2026 benefits from reconfiguration.
Revenue $22.834B +8% QoQ
EPS $1.76 reported
Gross margin 13.27% reported
INTERNATIONAL op margin 12.4% reported

What changed this quarter

01
Guidance

Raising full-year 2026 guidance

Guidance · revenue to $91.2B

02
Demand

2 million pieces/day Amazon volume eliminated

Management struck a confident tone, driven by the successful completion of the Amazon Glide Down and network reconfiguration, strong second-quarter results exceeding expectations, and raising full-year guidance.

03
AI

AI-powered digital twin deployed

Carol Tome discussed investing in RFID and artificial intelligence (AI), describing RFID as the 'eyes and ears' and AI as the 'brain' that transforms data from package movements into decisions, predictions, and actions. She noted the AI-powered digital twin of the network…

04
Margins

U.S. domestic operating margin up 400 bps from Q1

Reported gross margin was 13.27%, reinforcing the quarter's better-than-guided profitability.

AI, capex & demand read

AI

Platform & monetization

Carol Tome discussed investing in RFID and artificial intelligence (AI), describing RFID as the 'eyes and ears' and AI as the 'brain' that transforms data from package movements into decisions, predictions, and actions. She noted the AI-powered digital twin of the network enables dynamic adaptation to changing conditions.

Demand

Bookings & conversion

2 million pieces/day Amazon volume eliminated. Management struck a confident tone, driven by the successful completion of the Amazon Glide Down and network reconfiguration, strong second-quarter results exceeding expectations, and raising full-year guidance.

Capex

Investment and capacity

Brian Dykes stated that capital expenditures for 2026 are still expected to be about $3 billion, and when asked about the longer-term run rate, Carol Tome indicated it would be approximately 3.5% of revenue.

Tone · confident

Management struck a confident tone, driven by the successful completion of the Amazon Glide Down and network reconfiguration, strong second-quarter results exceeding expectations, and raising full-year guidance.

Supply-chain alpha

A1

UPS reduced Amazon volume to 9% of revenue, down from over 13% peak, de-risking the business and showing Amazon is internalizing delivery.

AMZN
“As a percent of our total revenue, Amazon made up 9%. That's down about 100 basis points from a year ago and certainly down from the peak, which was over 13% during the COVID year.”
Carol Tome

Forward guidance

RaisedGuidance · revenue to $91.2B · was IN LINE last Q
MetricPeriodRangeMidpointStatus
EPSFY2026$7.22$7.22RAISED
Op marginUS_DOMESTICFY20267.5%7.5%MAINTAINED
Op marginINTERNATIONALFY202614%–16%15%MAINTAINED
Op marginSUPPLY_CHAIN_SOLUTIONSFY202610%–11%10.5%MAINTAINED
Op marginUS_DOMESTICFY2026 Q37%7%MAINTAINED
RevenueFY2026$91.2B$91.2BRAISED
RevenueUS_DOMESTICFY2026$60B$60BMAINTAINED

Guidance credibility

2 / 3met or beat
IssuedMetricTargetGuideActualOutcome
FY2026 Q1Op marginFY2026 Q27.5%–8.5%8%Met / beat
FY2026 Q1Op marginFY2026 Q213%–14%12.4%Missed
FY2026 Q1Op marginFY2026 Q29.5%–10.5%10.2%Met / beat

Company read-throughs

AMZN
+10.6%
since call
$233.75→$258.52
CustomersSupply-chain alpha

UPS reduced Amazon volume to 9% of revenue, down from over 13% peak, de-risking the business and showing Amazon is internalizing delivery. — Amazon relying less on UPS strengthens Amazon's own logistics and reduces a major revenue dependency for UPS, shifting competitive dynamics in parcel delivery.

“I also want to thank our partners at Amazon for collaborating with us on what was truly a complex undertaking.”
Carol Tome