When it comes to the latest business news, United Parcel Service (UPS) recently made headlines with their second-quarter results. On Tuesday, UPS reported that their profit and revenue for the quarter fell below expectations, resulting in a stock drop of more than 13%. This news has investors and analysts alike paying close attention to the shipping giant’s next steps.
The company’s CEO, Carol Tomé, attributed the lower-than-expected results to changes in volume momentum affecting their business. As a result, UPS adjusted its full-year revenue guidance to approximately $93 billion, down from the previous forecast of $94.5 billion. However, the company remains optimistic about its future growth and has plans to deploy cash from the sale of its trucking business, Coyote Logistics, for share repurchases totaling around $500 million.
In addition to selling Coyote Logistics, UPS recently announced its plans to acquire Mexican express delivery company Estafeta, further expanding its reach in the shipping industry. These strategic moves highlight UPS’s commitment to adapting to the evolving market landscape and solidifying its position as a key player in the industry.
Despite the challenges faced in the second quarter, UPS remains focused on returning to operating profit growth. With changes in product mix and an emphasis on expense management, the company is optimistic about its future profitability. CFO Brian Dykes also mentioned that UPS expects to grow third-quarter operating profit by double digits, signaling a positive outlook for the remainder of the year.
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