UPS is set to cut 20,000 jobs, approximately 4% of its global workforce, a move driven by increased automation and a strategic reduction in its business with Amazon. The company previously announced a plan to halve its Amazon business by mid-2026, as it is not profitable or a healthy fit for their network. As part of its strategy, UPS plans to close 73 US facilities and automate operations in 400 locations, reducing its dependence on labor. Despite uncertainties from tariffs, particularly those affecting Chinese imports, UPS is not ready to alter its full-year guidance but anticipates a revenue dip in the next quarter. CEO Carol Tome acknowledges the uncertainty surrounding tariffs and expresses concern over their potential impact on US consumers, although consumer sentiment remains relatively healthy for now.

UPS is cutting 20,000 jobs, around 4% of its global workforce, as part of a strategic shift focusing on automation and reducing reliance on Amazon, its largest customer.

The company announced a 'glide down' plan to cut its Amazon business in half by 2026, due to the business being unprofitable and misaligned with UPS's network objectives.

UPS plans to close 73 US buildings and automate 400 facilities, implementing technology for sorting, labeling, and handling packages to lessen labor dependency.

While Trump-era tariffs, especially on Chinese imports, have affected UPS, the company remains uncertain about their long-term impact, with many customers hoping for a tariff roll-back.

Despite anticipating a revenue decline in the next quarter due to tariffs and the Amazon pull-back, UPS maintains its full-year guidance for now, though it remains cautious about potential future adjustments.

CEO Carol Tome highlights the uncertainty around future tariff impacts on consumer sentiment, yet notes that consumer health remains relatively robust despite these challenges.

The strategic changes at UPS reflect a broader industry trend towards automation and technology integration, a move that could reshape labor dynamics within the company.