UPS full-year outlook rises to $92.6 billion as Q3 beats and shares jump 5%

The holiday shipping season starts with a raised forecast from one of its biggest carriers. The UPS full-year outlook now calls for about $92.6 billion of revenue, up from $91.2 billion, after a third quarter that beat Wall Street estimates, and the shares rose about 5% on Tuesday.

What happened

Revenue grew 6.7% to $22.9 billion, ahead of the $22.29 billion analysts expected, and adjusted earnings per share were $1.69 against $1.63 expected, according to LSEG data cited by CNBC. On a GAAP basis, diluted EPS was $1.37 and net income $1.16 billion, down from $1.31 billion a year earlier. Reported results included a net charge of $279 million, among them a $182 million goodwill impairment in Supply Chain Solutions.

U.S. Domestic revenue rose 4.5% on a 6.1% increase in revenue per piece, International grew 7.1%, and Supply Chain Solutions jumped 18.2% on forwarding and logistics, including healthcare, the company said. For the fourth quarter, UPS expects about $25.7 billion of revenue and $3.3 billion of adjusted operating profit. For 2026 it now guides to about $8.75 billion of adjusted operating profit, adjusted EPS of about $7.28 and adjusted free cash flow of about $6.1 billion.

Margins improved across the network. Consolidated operating profit was $1.7 billion, or $2.1 billion on an adjusted basis, for a 7.6% operating margin and 9.0% adjusted. International posted a 14.9% operating margin and, per 24/7 Wall St., grew operating profit against a year earlier for the first time in several quarters. Healthcare revenue topped $3 billion for a third straight quarter, Tomé told analysts, according to CNBC.

Why it matters

UPS is an early read on holiday demand. "US consumers remain resilient and the outlook for holiday demand is strong," CEO Carol Tomé said on the call, according to 24/7 Wall St. Small and midsize businesses made up a record 35.1% of U.S. volume, helping lift the domestic operating margin by 60 basis points to 7%. Tomé said nearly 70% of packages will flow through automated processes this season, CNBC reported, even as the planned reduction in Amazon volume keeps cutting domestic average daily volume.

The stock traded at $105.01 in the afternoon, while FedEx rose 2% ahead of its own report, 24/7 Wall St. said. The raised UPS full-year outlook joins a busy earnings stretch, from the 3M-led Dow one-month high to mixed reactions such as Western Digital's earnings.

What's next

FedEx is due to report later this week, and investors will look at whether profitability in the supply chain unit, where profit fell despite higher revenue, steadies. The Efficiency Reimagined program of network consolidation and automation should bring close to $3 billion in benefits for 2026, 24/7 Wall St. said. A second raise in a row leaves less room for error, so the UPS full-year outlook now depends on a smooth peak season. The full guidance is in UPS's third-quarter release.