Core Insights - United Parcel Service (UPS) is experiencing significant revenue weakness due to soft demand, tariff-related uncertainty, elevated inflation, and geopolitical challenges [2][5] - The company reported a 3.7% year-over-year revenue decline in Q3 2025 and anticipates a further 5.4% decline in Q4 2025 [3][9] - Consolidated package volumes fell by 9.8% in Q3 2025 and are expected to drop by 10.6% in Q4 2025 [3][9] Revenue Performance - UPS's revenues decreased by 2.4% in the first nine months of 2025, with lower package volumes contributing to this decline [2] - The company is projected to see a 1.6% revenue decrease in 2026, continuing the trend of revenue pressure [5] Volume Trends - Consolidated volumes are expected to decline by 4.9% year over year in 2026 due to ongoing economic headwinds [6] - UPS's decision to reduce business with Amazon by over 50% is likely to keep near-term volumes muted [4][9] Competitive Landscape - FedEx, a competitor, is also facing similar revenue pressures and is implementing cost-cutting measures to address the soft demand environment [6] - FedEx's DRIVE program has generated significant cost savings, indicating a broader industry trend towards operational efficiency [7] Stock Performance and Valuation - UPS shares have declined over 15% in the past year, underperforming its industry [8] - The company currently trades at a 12-month forward price-to-sales ratio of 1.03X, which is below industrial levels [11] Earnings Estimates - The Zacks Consensus Estimate for UPS's fourth-quarter and full-year 2025 earnings has been revised moderately upward, while estimates for full-year 2026 earnings have been revised downward [13]