UPS (UPS) Q4 2024 earnings summary

Executive summary

• Q4 2024 consolidated revenue rose 1.5% year-over-year to $25.3B, with operating profit up 11.2% to $3.1B and adjusted EPS up 11.3% to $2.75.

• Full-year 2024 revenue was $91.1B, with operating profit of $8.9B and adjusted EPS of $7.72.

• Strategic actions included reducing Amazon volume by over 50% by mid-2026, insourcing all SurePost deliveries, and launching Efficiency Reimagined to drive $1B in savings.

• Network optimization included 49 facility closures and increased automation.

• Focus is shifting to higher-margin segments such as SMBs, healthcare, B2B, and international, with SMB share of U.S. volume targeted to reach 32% in 2025.

Financial highlights

• Q4 2024 operating margin was 12.3% (adjusted), with net income of $2.36B (adjusted) and diluted EPS of $2.75.

• Full-year 2024 operating margin was 9.8% (adjusted), with cash from operations of $10.1B and free cash flow of $6.3B.

• U.S. domestic Q4 revenue was $17.3B (+2.2% YoY), operating profit $1.8B (+11% YoY), and margin 10.1%.

• International Q4 revenue was $4.9B (+6.9% YoY), operating profit $1.1B (+18.1% YoY), and margin 21.6%.

• Supply Chain Solutions Q4 revenue was $3.1B, operating profit $284M, and margin 9.3%.

Outlook and guidance

• 2025 consolidated revenue expected at ~$89B, with operating margin of ~10.8% and free cash flow of ~$5.7B.

• U.S. domestic 2025 revenue to decline 2.3% YoY, ADV down ~8.5%, but revenue per piece up ~6%; operating margin to rise to 8.8%.

• International 2025 revenue to grow ~2.5% YoY, margin ~18.6%.

• Supply Chain Solutions 2025 revenue expected at ~$11B, margin ~8.5%.

• 2025 CapEx planned at $3.5B, dividends at $5.5B, and share repurchases at $1B.