UPS is planning to cut up to 30,000 jobs this year, largely due to reduced shipments from its biggest customer, Amazon. The company, known for being a major player in package delivery, has found that these Amazon deliveries are hurting its profit margins.
The job reductions will come through buyouts offered to full-time drivers and by not replacing employees who leave voluntarily. In the last quarter of the previous year, UPS reported earnings of $24.5 billion and predicted a revenue increase to $89.7 billion for the coming year.
This shift isn’t new for UPS. Last year, they announced a strategy to lessen their reliance on Amazon and focus on more profitable clients, such as healthcare companies. In 2025, UPS cut 48,000 jobs and closed 93 facilities, and they plan to shut down another 24 facilities in the first half of this year. CEO Carol Tomé mentioned that these changes are part of a broader strategy to optimize operations, including reducing deliveries by another million packages per day.
UPS, with roughly 490,000 employees, has a significant unionized workforce. The company’s annual report highlights that nearly 78,000 of those employees work in management.
In a separate development, UPS has announced that it will retire its MD-11 cargo planes following a tragic crash in Louisville, Kentucky. These planes represented about 9% of UPS’s fleet and had been grounded since the incident.
As UPS navigates these challenges, Amazon has been growing its own delivery services at a rapid pace. In 2024, Amazon managed 6.3 billion deliveries in the U.S., surpassing both UPS and FedEx. According to a report by Pitney Bowes, Amazon is expected to not just maintain this momentum but also potentially overtake the U.S. Postal Service in delivery volumes by 2028.
In essence, UPS is in a tough spot, trying to find its footing as market dynamics shift. The company’s strategic pivots reveal its adaptability but also highlight the rising competition from companies like Amazon.
For more insights on UPS’s financial strategies and industry trends, check out the Pitney Bowes parcel shipping index.
