- The shares of United Parcel Service, Inc. (NYSE: UPS) surged over 14% on Thursday following better-than-expected second-quarter results.
The shares of United Parcel Service, Inc. (NYSE: UPS) surged over 14% on Thursday following better-than-expected second-quarter results. UPS has been seeing stronger volumes due to the pandemic and profits were better than what analysts were anticipating.
Prior to the market opening on Thursday, UPS reported revenue of $20.46 billion, which was significantly higher than expectations of between $17 billion and $18 billion.
Net income for the quarter increased to $1.77 billion ($2.03 a share) from $1.69 billion ($1.94 a share) in the year-ago period.
Overall volumes were up 20.9% and domestic was up 22.8% — which translates to 22.1 million parcels being shipped per day. Business-to-consumer deliveries were up 65% in the U.S. That bump in business-to-consumer deliveries are “Christmas-like” numbers, according to Chief Financial Officer Brian Newman.
“At the beginning of the second quarter, we assumed demand would slow. Instead, we saw just the opposite,” said UPS’ new Chief Executive Carol Tomé
The conditions that led to stronger performance for UPS in the second quarter is expected to continue for the third quarter. And UPS volumes will likely stay higher as the shift towards e-commerce is expected to become more permanent.
However, UPS did not provide guidance for the remainder of the year due to uncertainty about the pandemic and the economic recovery. And if the volumes keeps increasing, UPS would have to make more investments in its infrastructure to keep up with the demand.
UPS added nearly 40,000 new employees over the last few months and the company also flew 635 more flights than usual.
The UPS stock for the month is up 27.24%; 49.44% over 3 months; 30.98% over 6 months; and 21.12% YTD.
UPS is up 0.78% as of 9:37AM ET today