United Parcel Service, Inc. (UPS), while announcing weak second-quarter results, on Tuesday trimmed fiscal 2023 forecast for revenue and adjusted operating margin.
In pre-market activity on the NYSE, UPS shares were losing around 5.6 percent to trade at $172.
UPS said the outlook update primarily reflects the volume impact from labor negotiations and the costs associated with the tentative agreement reached with the International Brotherhood of Teamsters on July 25.
UPS now expects full-year consolidated revenue to be about $93 billion. The company previously said it expected revenue to be at the low end of its earlier guided range, and to be around $97.0 billion.
On average, 29 analysts polled by Thomson Reuters expect revenues of $96.77 billion for the year. Analysts’ estimates typically exclude special items.
Adjusted operating margin is now expected to be around 11.8 percent, while previous outlook was around 12.8 percent.
In its second quarter, net income was $2.08 billion or $2.42 per share. Adjusted net income was $2.19 billion or $2.54 per share, compared to $3.29 per share in 2022.
Consolidated operating profit fell 21.4 percent to $2.8 billion. Consolidated revenues of $22.1 billion was down 10.9 percent from $24.8 billion a year ago.
The Street expected earnings of $2.5 per share on revenues of $23.1 billion for the quarter.
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