UPS announced better-than-expected performance in third-quarter earnings, with growth across all segments, gains from network optimization, increased revenue from profitable small and medium businesses (SMBs) and strong outbound demand from Asia.
“We are making progress against the ‘better, not bigger’ framework we outlined in July,” CEO Carol B. Tomé said on the investor conference call. “We’re leaning in on the wildly important areas of our business and tackling challenges head on.”
Despite the COVID-related economic downturn, UPS successfully optimized its network and grew share with profitable SMBs.
The company also saw the highest quarterly growth in nearly three years in the International, and Supply Chain and Freight segments.
Using the corporate strategy as a platform, Carol highlighted achievements and challenges for Q3 and beyond.
Customer First. “We’ve heard from customers that speed and ease are most important, so we are focused on delivering the capabilities that matter most to our customers,” she said.
People Led. “We know successful outcomes are built from a strong culture of teamwork, respect, trust and empowerment,” Carol said.
Innovation Driven. “We are on a journey to optimize the volume that flows through our network,” she said.
Looking to the fourth quarter, Carol addressed performance expectations for the holiday season.
“We have been operating in a peak-like environment globally for many months, which is helping us prepare for the elevated demand ahead,” she said.
As in previous years, UPS will collaborate with customers to match their needs to UPS’s available capacity. Increased automated sort capacity, expanded weekend operations and Our Fastest Ground Ever will also help manage the expected increase in volume.
Carol reminded investors all aspects of the business, apart from the five core principles, are under review.
“I’ve spent a lot of time looking at the risks and opportunities facing our business, including an evaluation of our business portfolio,” she said. “We are an opportunity-rich company. We are making progress, but given the size of our business, it will take time to optimize our network, to stop processes that have added cost and no customer value, and to fully reach our potential.”
“We are making progress against the ‘better, not bigger’ framework we outlined in July,” CEO Carol B. Tomé said on the third-quarter investor conference call. “We’re leaning in on the wildly important areas of our business and tackling challenges head on.”