LOUISVILLE, Ky. (LEX 18) — UPS delivered solid fourth-quarter financial results Monday, posting $24.5 billion in consolidated revenues while achieving an 11.8% non-GAAP adjusted operating margin that exceeded expectations. In addition, the companies earnings report revealed that the aircraft fleet in the deadly Louisville crash in November has officially been retired.
The Atlanta-based logistics giant reported diluted earnings per share of $2.10, or $2.38 on a non-GAAP adjusted basis, for the quarter ending December 31, 2025. The company also declared a quarterly dividend of $1.64 per share.
"I want to thank UPSers across the globe for their tireless commitment to serving our customers as we delivered best-in-class service during peak for the eighth year in a row and outperformed our financial expectations in the fourth quarter," said Carol Tomé, UPS chief executive officer.
Tomé highlighted 2025 as "a year of considerable progress" as the company strengthened revenue quality and built a more agile network. She emphasized that 2026 will mark "an inflection point" following the completion of the Amazon volume reduction.
Segment performance shows mixed results
The U.S. Domestic segment saw revenue decline 3.2% to $16.8 billion, primarily due to expected volume decreases. However, revenue per piece grew 8.3%, demonstrating improved pricing power. Operating margin reached 8.5%, or 10.2% on an adjusted basis.
International operations posted revenue growth of 2.5% to $5.0 billion, driven by a 7.1% increase in revenue per piece. The segment maintained strong profitability with an 18.0% adjusted operating margin.
Supply Chain Solutions faced headwinds with revenue declining 12.7% to $2.7 billion, mainly due to volume decreases in the Mail Innovations business. The segment achieved a 10.3% adjusted operating margin.
Fleet modernization and transformation costs impact results
UPS accelerated its fleet modernization during the quarter, completing the retirement of its MD-11 aircraft fleet, the aircraft involved in the deadly. This resulted in a non-cash, after-tax charge of $137 million.
The company also incurred $101 million in after-tax transformation charges as part of its ongoing Network Reconfiguration and Efficiency Reimagined initiatives. These programs generated approximately $3.5 billion in year-over-year cost savings during 2025.
Full-year results and 2026 guidance
For the full year 2025, UPS reported revenue of $88.7 billion with adjusted diluted earnings per share of $7.16. The company generated $8.5 billion in cash from operations and returned $6.4 billion to shareholders through dividends and share repurchases.
Looking ahead to 2026, UPS expects consolidated revenue of approximately $89.7 billion with a non-GAAP adjusted operating margin of about 9.6%. The company plans capital expenditures of $3.0 billion and dividend payments of around $5.4 billion, subject to board approval.
The transformation initiatives are expected to deliver approximately $3 billion in savings during 2026, with programs concluding by 2027.
