UPS(US:UPS)2025-10-28 10:09Revenue Performance - Total revenue for Q3 2025 was $21,415 million, a decrease of $830 million or 3.7% compared to Q3 2024[2] - U.S. Domestic Package revenue decreased by $377 million or 2.6% to $14,220 million, while International Package revenue increased by $262 million or 5.9% to $4,673 million[2] - Total revenue for the nine months ended September 30, 2025, was $64,182 million, a decrease of $1,587 million or 2.4% compared to $65,769 million in 2024[9] - U.S. Domestic Package revenue decreased by $301 million or 0.7% to $42,763 million, while International Package revenue increased by $494 million or 3.8% to $13,531 million[12] - Supply Chain Solutions revenue fell by $715 million or 22.1% to $2,522 million, primarily due to a significant drop in Forwarding revenue[2] - Supply Chain Solutions revenue fell by $1,780 million or 18.4% to $7,888 million, primarily due to a significant drop in Forwarding revenue[12] Profitability Metrics - Operating profit for Q3 2025 was $1,804 million, down $181 million or 9.1% from $1,985 million in Q3 2024[2] - Net income for Q3 2025 was $1,311 million, a decline of $228 million or 14.8% compared to $1,539 million in Q3 2024[2] - Operating profit for the total company was $5,292 million, down $250 million or 4.5% from $5,542 million in the previous year[9] - Net income for the nine months ended September 30, 2025, was $3,781 million, a decline of $280 million or 6.9% compared to $4,061 million in 2024[9] - Basic earnings per share decreased to $4.46, down $0.28 or 5.9% from $4.74 in the prior year[9] - Non-GAAP adjusted operating profit for Q3 2025 was $2.132 billion, with a non-GAAP adjusted operating margin of 10.0%, compared to 8.9% in Q3 2024[22] - Non-GAAP Adjusted Operating Profit for the nine months ended September 30, 2025, was $5,771 million, with an operating margin of 9.0%[38] Operating Expenses - Total operating expenses for Q3 2025 were $19,611 million, down $649 million or 3.2% from $20,260 million in Q3 2024[2] - Total operating expenses were $58,890 million, a reduction of $1,337 million or 2.2% from $60,227 million in 2024[14] - U.S. Domestic Package Operating Expenses decreased by 1.0% to $13,617 million, with an operating profit of $603 million, down 28.5% year-over-year[33] - International Package Operating Expenses increased by 10.6% to $3,997 million, with an operating profit of $676 million, down 15.3% year-over-year[33] - Supply Chain Solutions Operating Expenses decreased significantly by 31.0% to $1,997 million, with an operating profit of $525 million, up 52.6% year-over-year[33] Volume and Pricing - Average Daily Package Volume decreased by 2,108 thousand or 9.8% to 19,419 thousand in Q3 2025 compared to Q3 2024[5] - Average Daily Package Volume decreased by 1,246 thousand packages or 5.9% to 19,974 thousand packages[12] - The average revenue per piece for U.S. Domestic Package increased by 9.8% to $13.47 in Q3 2025 from $12.27 in Q3 2024[5] - The average revenue per piece for U.S. Domestic Package increased by 6.5% to $13.18, reflecting improved pricing strategies[12] - U.S. Domestic Package Cost Per Piece (GAAP) increased by 12.3% to $12.92, while Non-GAAP Adjusted Cost Per Piece increased by 10.4% to $12.63[35] - U.S. Domestic Package Cost Per Piece (GAAP) rose to $12.43 in 2025, a 7.2% increase from $11.59 in 2024[55] - Non-GAAP Adjusted Cost Per Piece for U.S. Domestic Package was $12.30 in 2025, reflecting a 6.4% increase from $11.56 in 2024[55] Cash Flow and Assets - Free cash flow for the nine months ended September 30, 2025, was $2.744 billion, a decline of 32% from $4.038 billion in the same period of 2024[20] - Cash and cash equivalents increased to $6.764 billion at the end of Q3 2025, up from $6.112 billion at the beginning of the period[18] - Total assets increased to $71.392 billion as of September 30, 2025, compared to $70.070 billion on December 31, 2024, reflecting a growth of 1.9%[16] - Total current liabilities decreased to $14.552 billion as of September 30, 2025, from $16.441 billion at the end of 2024, a reduction of 11.5%[16] Transformation and Strategy Costs - The company incurred total transformation strategy costs of $328 million in Q3 2025, up from $154 million in Q3 2024[22] - Total Transformation Strategy Costs for the nine months ended September 30, 2025, were $460 million, up from $227 million in 2024[38] - Transformation Strategy Costs for U.S. Domestic Package were $400 million in 2025, compared to $93 million in 2024[53] Other Income and Gains - Total other income (expense) was $(197) million, a decline of $122 million or 162.7% compared to $(75) million in Q3 2024[2] - The company reported a total other income (expense) of $(500) million, an increase in expense of $273 million or 120.3% compared to $(227) million in 2024[9] - The company reported a pre-tax gain of $20 million on the divestiture of a business within Supply Chain Solutions[48] - A pre-tax gain of $156 million was recorded from the divestiture of the Coyote Logistics business in 2024[50] - The company recorded a pre-tax one-time payment of $88 million related to an international regulatory matter in 2024[50]