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Ups Shares Fall as Consumer Caution Dims E-Commerce Outlook
Published by Jessica Weisman-Pitts
Posted on April 26, 2022
2 min readLast updated: February 7, 2026
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Company
Published by Jessica Weisman-Pitts
Posted on April 26, 2022
2 min readLast updated: February 7, 2026
Add as preferred source on Google(Reuters) -United Parcel Service Inc on Tuesday reported better-than-expected quarterly earnings, but shares fell 3% after executives said they expected e-commerce delivery growth – which drove its pandemic business – to cool this year.
(Reuters) -United Parcel Service Inc on Tuesday reported better-than-expected quarterly earnings, but shares fell 3% after executives said they expected e-commerce delivery growth – which drove its pandemic business – to cool this year.
UPS now expects volume in its biggest U.S. business to fall in the first half of 2022 before improving in the latter part of the year.
“We’re not going to see the kind of (e-commerce) growth that we experienced during COVID, but ecommerce sales will continue to grow,” Chief Executive Officer Carol Tome said on a conference call with analysts.
Executives said higher shipping rates, fuel surcharges and more large and small business deliveries would offset softer demand for residential e-commerce package drops – as they did in the first quarter.
Atlanta-based UPS reiterated its 2022 outlook for revenue of about $102 billion and adjusted operating margin of roughly 13.7%. It also announced plans to double its 2022 share buy-back target to $2 billion. Still, shares fell $5.72 to $183.92 in early trading.
Results from UPS came almost two weeks after the Commerce Department reported back-to-back declines in e-commerce sales for February and March. Pandemic-weary consumers shifted some spending from goods to services in response to the United States lifting COVID prevention measures. At the same time, record gas prices bit into disposable income.
During the first quarter, average daily volume in the UPS domestic business fell 3% – driven by a 7.4% drop in residential deliveries. COVID variant outbreaks, record gas prices and political uncertainty fueled by Russia’s war on Ukraine drove the decline from last year’s stimulus check-fueled volume boom, executives said.
Still, UPS reported first-quarter adjusted earnings of $3.05 per share on revenue of $24.4 billion. Those results topped analysts’ average targets for earnings of $2.88 per share and revenue of $23.78 billion.
(Reporting by Kannaki Deka in Bengaluru and Lisa Baertlein in Los Angeles; Editing by Shounak Dasgupta, Anil D’Silva and Lisa Shumaker)
E-commerce refers to buying and selling goods or services using the internet. It includes online retail, electronic payments, and mobile commerce.
Corporate profits are the earnings that a company generates after deducting all expenses, taxes, and costs from its total revenue.
Financial management involves planning, organizing, directing, and controlling the financial activities of an organization to achieve its financial goals.
Delivery services refer to businesses that transport goods from one location to another, often directly to consumers or businesses.
Consumer perception is how customers view and interpret a brand, product, or service, which can significantly influence their purchasing decisions.
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