2023-10-26 06:55:51 ET
UPS ( NYSE: UPS ) shares dipped as much as 5% premarket on Thursday after the company revised its full-year 2023 outlook citing global macro-economic uncertainty.
The Atlanta-based shipping and logistics firm now expects full-year 2023 consolidated revenue of $91.3B-$92.3B (vs. ~$93B previously and $92.74B consensus ) and a consolidated adjusted operating margin of 10.8%-11.3% (vs. 11.8% previously).
Nevertheless, the company kept its full-year planned capital expenditures target of about $5.3B and dividend payment expectations of ~$5.4B, subject to board approval, unchanged.
Unfavorable macro-economic conditions also negatively impacted global demand which, in turn, hurt the company's third quarter results. Q3 consolidated revenues fell 12.8% Y/Y to $21.1B, while adjusted diluted earnings per share of $1.57 were 47.5% below the same period in 2022.
U.S. domestic segment saw its revenue decline by 11.1%, driven by a 11.5% fall in average daily volume, which was partially offset by a 2.0% increase in revenue per piece.
Revenue in the international segment fell 11.1%, primarily driven by a 6.6% decrease in average daily volume and continued softness on Asia and Europe trade lanes.
CEO Carol Tomé said, "While unfavorable macro-economic conditions negatively impacted global demand in the quarter, our U.S. labor contract was fully ratified in early September and volume that diverted during our labor negotiations is starting to return to our network. Looking ahead, we are well-prepared for the peak holiday season."
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UPS stock dips after slashing full year outlook