UPS CFO on Amazon pullback and driving a growth strategy

Core Insights - UPS is strategically repositioning itself for long-term growth by reducing its partnership with Amazon, which has been in place for nearly 30 years [1][4] - The company reported Q3 revenue of $21.4 billion and adjusted EPS of $1.74, exceeding Wall Street expectations, and projects Q4 revenue of approximately $24 billion [1] Business Refocus - UPS is transforming its U.S. operations to concentrate on high-margin market segments such as small and midsized businesses, health care logistics, and B2B delivery, moving away from low-return, capital-intensive volume [3] - The decision to halve Amazon delivery volume by late 2026 reflects a strategic shift, as UPS aims to focus on areas where it can add the most value [4] Operational Adjustments - UPS has cut about 34,000 operational positions in 2025, primarily through attrition and targeted buyouts, and closed operations at 93 facilities while eliminating 14,000 management jobs [6] - The company expects a 20% volume increase from Q3 to Q4, translating to roughly 4 million additional packages per day, indicating readiness for the holiday season despite reduced Amazon volume [7] Health Care Growth - UPS's health care segment has grown significantly, from zero to a $10 billion business since 2016, driven by targeted acquisitions and a focus on cold chain logistics, quality assurance, and regulatory oversight [8][9] - The health care customers are noted for their longevity and faster growth, contributing to higher margins, which is seen as a sustainable growth strategy [9]