UPS released its Q2 report recently and people who estimated their earnings for the second quarter were in for a surprise. UPS reported their earnings that totally beat all the estimates although there was an overall drop in the net revenue. The courier/parcel delivery service could fight a major loss thanks to their increased profit margin this quarter and mostly because of their overseas business performance. The total shipment in the overseas business has peaked at 2.1%, reaching about 1.1 billion in deliveries. The estimated value of per share was placed at $1.26, but UPS beat that by earning $1.35 per share while their last year’s share stood at $1.21. But despite this success, the overall revenue went down to $14.1 billion.
UPS shares had gone down up to 15% this year, but the stocks were up soon when the news of the Q2 earnings broke. UPS saw an increase in operating profits and is now focused on growing their business in America and better management of revenue. According to their representative, the International segment has had a positive force with about 17% profit in operating sector. The company is focused on delivering on the growing customer demand around the world. The supply chain and freight segment also saw a significant boost in the operating profits. Our Supply Chain & Freight segment also had a solid increase in operating profit.
The company was affected by the dollar rates and also the constant drop off in the fuel surcharges because of the low oil prices. UPS’s revenue for their domestic package business was around 8.81 billion which is more than last year’s $8.67 billion. The company’s Vice President Alan Gershenhorn defended the slow growth in their ground sector and said that the current figures are competing against last year good performance which was greatly helped by a large catalog shipment. UPS also hinted that they have plans to cut down on the hiring of seasonal workers this year compared to the results of last years. The prior year the company had hired about 80 thousand employees on a temporary basis which had lead to several unfortunate issues like package delays which affected their overall revenue.
Gershenhorn also added that UPS is hoping to benefit from several promotional events and innovative moves like Amazon’s Prime Day and other e-commerce organizations. These innovative events are bound to boost small package growth and benefit the industry in general.