United Parcel Service (NYSE:UPS) reported mixed third-quarter results Tuesday morning, posting earnings that beat analyst expectations and revenue that fell short of predictions.
Earnings per share proved to be $2.99 vs. $2.84 expected. Revenue came in at $24.16 billion, in contrast to the $24.30 billion expected.
The company said softening demand globally hurt volumes, which was partially offset by higher pricing driven by inflation.
UPS also reaffirmed its outlook for full-year revenue of $102 billion and adjusted operating margin of about 13.7%, despite what CEO Carol Tomé called a “very dynamic” macroeconomic environment.
The company did scale back its expected capital expenditures to $5 billion from about $5.5 billion, however.
Revenue in U.S. domestic and international packages grew from the same period last year, while the company’s supply chain solutions saw revenues shrink 6.3% due to declines in air and ocean freight forwarding.
Freight forwarding is the company’s large-volume pallet shipping operation, which — distinct from its small package services — delivers large quantities of cargo across the world, managing customs and border logistics. The services sometimes use UPS vehicles and can also consolidate shipments into other vehicles and their routes.
The company said the declines were partially offset by growth in its logistics and health care businesses.
The shipping giant struggled in the prior quarter with declining volumes, partially offset by higher rates. The decrease in shipments was attributed to less business with large clients like Amazon (NASDAQ:AMZN)
UPS shares began Tuesday higher by $4.03, or 2.4%, to $171.58.
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