Part 6/11:
UPS’s recent earnings call revealed that the company is actively "gliding down" from lower-margin contracts, notably from Amazon. The company has indicated that it is approximately three-quarters through a six-quarter plan to reduce its engagement with Amazon’s lower-yield packages. This shift is driven by the realization that such business models are less profitable, even if they involve handling more packages.
Instead, UPS is sharpening its focus on higher-margin, revenue-generating services. The decision to gradually exit Amazon’s low-margin parcel business allows UPS to reallocate resources toward more profitable sectors, reducing operational complexity and boosting overall profitability.