UPS Cuts 34,000 Jobs in Sweeping Cost Overhaul, Exceeding Earlier Layoff Target

UPS shares surged on Tuesday after the company reported its quarterly results, announcing job cuts.

A UPS driver sorts his deliveries, on New York's Upper West Side, on July 15, 2023. /Richard Drew/AP

United Parcel Service (UPS) has eliminated 34,000 operational jobs as part of an extensive cost-cutting and restructuring effort, the company said on Oct. 28. That is a far larger reduction than the 20,000 layoffs announced earlier this year.

The shipping and logistics giant said in its third-quarter earnings report that it has also closed 93 leased and owned facilities through September under its ongoing “Network Reconfiguration” and “Efficiency Reimagined” programs. UPS described the moves as the most significant operational changes in its history.

“We have reduced our operational workforce by approximately 34,000 positions and closed daily operations at 93 leased and owned buildings during the first nine months of 2025,” UPS said.

The company added that it continues to evaluate expected volume changes in its air and ground networks to identify further closures.

UPS said the measures have generated about $2.2 billion in cost savings so far this year and are expected to yield $3.5 billion in total annual savings in 2025. The company said the initiative is expected to conclude in 2027.

UPS said in April it would scale back deliveries for Amazon, its largest customer, and reduce its reliance on the e-commerce giant. The April plan called for 20,000 job cuts and the closure of 73 facilities.

Monday’s update showed the scale of reductions has grown considerably as UPS accelerates its operational overhaul.

UPS said the latest cuts and closures are not routine adjustments, but part of “separate and distinct activities that may span multiple periods and are not expected to drive incremental revenue.” The company added that the scope of these programs exceeds that of “routine, ongoing efforts to enhance profitability.”

Restructuring Costs

The restructuring has carried a significant short-term cost.

UPS said it has incurred $422 million in expenses as of Sept. 30, including $387 million year to date, covering consulting fees, employee separation benefits, and other costs.

It expects total expenses related to job cuts and operation site closures to reach between $400 million and $650 million this year.

The company noted those costs could increase “should we determine to close additional buildings.”

Earnings Rise and Stock Surges

UPS shares jumped 17.9 percent in premarket trading on Tuesday after the company reported its quarterly results.

For the third quarter ended Sept. 30, UPS  reported consolidated revenue of $21.4 billion, while operating profit reached $1.8 billion, or $2.1 billion on a non-GAAP adjusted basis.

Diluted earnings per share came in at $1.55 and $1.74 on an adjusted basis.

UPS said its GAAP results for the quarter included a net charge of $164 million, or $0.19 per share, largely tied to transformation strategy costs of $250 million, partially offset by an $86 million income-tax benefit.

The company also recorded a $330 million pre-tax gain from a sale-leaseback transaction involving five properties, part of its broader effort to monetize real estate assets and reinvest in growth. UPS said the move added about $0.30 to diluted earnings per share and would not disrupt ongoing operations.

CEO Carol Tomé praised employees for their role during what she called a pivotal restructuring.

“I want to extend my gratitude to all UPSers for their dedication and steadfast commitment to serving our customers,” she said.

“We are executing the most significant strategic shift in our company’s history, and the changes we are implementing are designed to deliver long-term value for all stakeholders.”

Tomé added that with the holiday shipping season approaching, UPS is “positioned to run the most efficient peak in our history while providing industry-leading service to our customers for the eighth consecutive year.”

UPS’s operational revamp comes as global carriers face pressure to adapt to shifting e-commerce patterns and slower delivery growth following the pandemic boom. The company has also been working to offset the financial impact of new trade tariffs and higher labor costs.

In April, Tomé said that the company’s domestic and global demand shifted downward in February and has since fallen further than expectations and normal shipping patterns.

The restructuring, expected to conclude in 2027, is aimed at simplifying UPS’s air and ground network, reducing excess capacity, and investing in automation and technology. The company said the initiatives are designed to ensure profitability even amid lower package volumes.