United Parcel Service (UPS) announced plans to cut up to 30,000 operational jobs in 2026 as part of its ongoing turnaround strategy, which includes reducing its partnership with Amazon. The company also reported better-than-expected quarterly earnings, with shares rising nearly 2% in morning trading.
Immediate Action & Core Facts
1. Job Cuts and Turnaround Plan
UPS will eliminate up to 30,000 operational roles by 2026, primarily through attrition and a voluntary separation program for drivers. This follows last year’s reduction of 48,000 jobs, including 34,000 operational and 14,000 management positions. The company aims to save $3 billion by winding down its Amazon partnership, which it previously called "extraordinarily dilutive" to margins.
2. Earnings and Revenue Forecast
UPS beat Wall Street estimates for its fourth-quarter earnings, projecting $89.7 billion in revenue for 2026—higher than analysts’ expectations of $87.94 billion. The company also recorded a $137 million non-cash charge related to retiring its MD-11 fleet after a November crash.
Deeper Dive & Context
Background on Amazon Unwind
UPS began scaling back its Amazon deliveries in January 2025, citing low-profit margins. The company expects to reduce operational hours by 25 million due to the decline in Amazon shipments. The turnaround plan, led by CEO Carol Tomé, focuses on higher-margin shipments and stabilizing volumes after the end of US duty-free e-commerce shipments.
Financial and Operational Adjustments
In 2025, UPS closed 93 facilities and launched driver buyouts as part of its cost-cutting measures. The company’s shares initially dipped 1% in premarket trading before rising 2% following the earnings report. Analysts noted the surprise revenue increase as a positive sign amid the restructuring.
Market and Industry Implications
The job cuts and Amazon unwind reflect broader shifts in the logistics industry, where companies are prioritizing profitability over volume. UPS’s strategy contrasts with competitors like FedEx, which has expanded its e-commerce partnerships. The move also raises questions about labor market stability in the logistics sector.