UPS (UPS) Q1 2025 earnings summary

Executive summary

• Q1 2025 consolidated revenue was $21.5B, down 0.7% year-over-year, mainly due to the Coyote divestiture and planned volume reductions from the largest customer, partially offset by higher revenue per piece and air cargo growth.

• Operating profit rose 3.3% to $1.7B, with adjusted operating profit at $1.8B and margin up to 8.2%.

• Adjusted diluted EPS increased 4.2% to $1.49, while net income rose 6.6% to $1.2B.

• Strategic initiatives include network reconfiguration, Efficiency Reimagined, and transformation programs targeting $3.5B in 2025 cost savings.

• Uncertainty around tariffs, global trade policy, and macroeconomic conditions is impacting demand and outlook.

Financial highlights

• U.S. Domestic segment operating profit grew by $164M year-over-year, with margin up 110 basis points to 7.0%.

• International segment ADV increased 7.1%, with export ADV up 9.3%.

• Supply Chain Solutions revenue was $2.7B, down 14.8% due to Coyote divestiture; operating profit declined 62.9% to $46M.

• Free cash flow was $1.5B; $1.3B paid in dividends and $1B in share repurchases.

• Cash from operations was $2.3B; capex was $876M.

Outlook and guidance

• No update to full-year outlook due to macro uncertainty; Q2 revenue expected at ~$21B, operating margin ~9.3%.

• U.S. ADV expected down ~9% in Q2; international revenue expected down ~2%.

• Supply Chain Solutions Q2 revenue to decline ~$500M due to Coyote; margin in high single digits.

• 2025 expenses of $400–$600M anticipated for network reconfiguration and efficiency programs.

• No further share repurchases expected in 2025.