UPS Layoff: United Parcel Service (UPS) made more profit than market estimates in the first quarter of this year 2025. However, the happiness that the great results gave was taken away by an announcement. The company has announced that it will lay off 20 thousand employees. This layoff is also connected to Amazon.
UPS Layoff: 20 thousand employees are going to lose their jobs in the giant parcel delivery company United Parcel Service (UPS). The company says that it has decided to layoff employees to reduce costs in an uncertain economy and due to the possibility of fewer shipment orders from its biggest customer Amazon. Last year, Amazon’s share in its revenue was 11.8 percent. When the world’s largest delivery company announced layoffs, investors welcomed this decision and the shares jumped by about 2 percent on Tuesday. The shares jumped because the company has expressed hope of saving $ 350 million this year due to layoffs and the closure of 73 leased and own buildings by the end of June.
How was the March quarter of UPS?
UPS’s revenue fell slightly to $ 2150 million in the March quarter, but according to LSEG data, it was more than the market’s $ 2105 million. Talking about revenue in the US domestic segment, it jumped 1.4% to $14.46 billion in the March quarter due to improvement in revenue per piece despite a surge in air cargo and a decline in volume. Adjusted profit during this period reached $1.49 against the estimate of $1.38.
How is the business environment?
UPS says that business activities have slowed down due to US tariffs and due to this, initiatives have to be taken to reduce costs in view of the slowdown in demand. Talking about parcel delivery firms, there is a possibility of reduced need for shipping services among companies due to the slowdown. UPS CEO Carol Tome says that there is so much uncertainty about the economy that no update is being given regarding the full year outlook. Earlier in January, the company had projected revenue of $ 89 billion and an operating profit margin of 10.8% in the full year 2025. Due to US tariffs, China-linked e-commerce sellers Temu PDD.O and Shein are facing a huge decline. From May 2, the US also imposed duty on parcels of items up to $ 800 which were previously duty-free.
