United Parcel Service, Inc. (UPS) — Fundamental Analysis
Based on SEC filings through the 10-Q filed May 6, 2026 (period ending March 31, 2026) and the 10-K filed February 17, 2026 (fiscal year ending December 31, 2025).
Snapshot & Big Picture
UPS is one of the world's largest package delivery and supply chain management companies, operating a vast global logistics network spanning ground, air, and international freight. With annual revenues consistently above $88 billion, UPS occupies a near-irreplaceable position in global commerce infrastructure. However, the past three fiscal years tell a story of gradual revenue pressure and margin compression — a combination of softening parcel volumes, elevated cost structures, and macroeconomic headwinds that management has been actively working to address through restructuring and efficiency programs.
Latest Quarter Snapshot (Q1 2026 — Most Current Data Available)
The most recent data comes from UPS's 10-Q for the quarter ending March 31, 2026, filed May 6, 2026. This is more current than the annual figures and provides the freshest read on where the business stands today.
| Metric | Q1 2026 (Period Ending Mar 31, 2026) |
|---|---|
| Revenue | $21.20 billion |
| EBITDA | $2.06 billion |
| Operating Margin | 5.98% |
| Net Margin | 4.08% |
| Current Ratio | 1.21 |
| Gross Margin | Not reported in filing |
| Debt-to-Equity | Not reported in filing |
Q1 2026 shows continued margin pressure versus prior annual periods. An operating margin of just under 6% is notably below the full-year figures of recent years. On an annualized basis, a $21.2 billion revenue quarter would imply roughly $84–85 billion in annual revenue, suggesting the top-line softness observed in fiscal 2025 may be continuing into 2026. EBITDA of $2.06 billion for the quarter also reflects a more challenging operating environment compared to recent full-year EBITDA run rates.
Profitability — Multi-Year Trend
Looking at the three most recent full fiscal years, a clear downward trend in profitability metrics is visible. Revenue has been essentially flat to declining, while margins have steadily eroded year-over-year.
| Fiscal Year | Revenue | EBITDA | Operating Margin | Net Margin |
|---|---|---|---|---|
| FY 2023 | $90.96 billion | $11.94 billion | 10.05% | 7.37% |
| FY 2024 | $91.07 billion | $11.47 billion | 9.30% | 6.35% |
| FY 2025 | $88.66 billion | $10.87 billion | 8.87% | 6.28% |
Every profitability metric has declined across all three years. Operating margin fell from 10.05% in FY 2023 to 8.87% in FY 2025 — a drop of roughly 118 basis points over two years. Net margin followed suit, declining from 7.37% to 6.28%. EBITDA has also trended downward from $11.94 billion to $10.87 billion. Gross margin data was not available in the filings provided. The trend is clearly one of declining profitability, and the Q1 2026 data suggests this may not yet have bottomed out.
Financial Health
Liquidity, as measured by the current ratio, has actually improved modestly over the period — moving from 1.10 in FY 2023 to 1.22 in FY 2025 and holding at 1.21 in Q1 2026. A current ratio above 1.0 indicates UPS can cover its short-term obligations with current assets, which is a reassuring baseline for a capital-intensive logistics operator.
| Period | Current Ratio | Debt-to-Equity |
|---|---|---|
| FY 2023 | 1.10 | Not reported in filing |
| FY 2024 | 1.17 | Not reported in filing |
| FY 2025 | 1.22 | Not reported in filing |
| Q1 2026 | 1.21 | Not reported in filing |
Debt-to-equity ratios were not available in the provided filing data, so a complete picture of UPS's leverage cannot be drawn from these figures alone. UPS is known to carry meaningful long-term debt — typical for large-cap industrials — but that assessment would require reviewing the full balance sheet detail within the filings directly.
Growth
Revenue growth has been effectively absent over the past three fiscal years. From FY 2023 to FY 2024, revenue was nearly flat (a marginal $112 million increase on a $91 billion base). FY 2025 then saw an actual decline of approximately $2.4 billion, or roughly 2.6%, compared to FY 2024. The Q1 2026 quarterly run rate, if extrapolated, points to further potential top-line contraction in FY 2026.
| Period | Revenue | YoY Change |
|---|---|---|
| FY 2023 | $90.96 billion | — |
| FY 2024 | $91.07 billion | +0.1% |
| FY 2025 | $88.66 billion | −2.6% |
| Q1 2026 (quarterly) | $21.20 billion | Annualizes below FY 2025 |
The absence of meaningful revenue growth — combined with declining margins — is the central challenge for UPS at this point in its cycle. Whether the company can stabilize volumes and re-expand margins through cost discipline and pricing initiatives will be the key question for investors watching the next several quarters.
Plain English Summary
UPS is a logistics giant that moves an enormous amount of the world's packages, but right now the business is going through a rough patch. Revenue has stalled and actually started shrinking, while profit margins have been declining each year for the past three years. Put simply, the company is earning less per dollar of sales than it was in 2023. The most recent quarterly data from early 2026 suggests this pressure isn't over yet — operating margins dipped to just under 6%, well below recent annual levels. On the positive side, UPS's short-term liquidity looks fine, with enough current assets to comfortably cover near-term bills. But the big picture is one of a highly established, essential business fighting against soft shipping volumes, cost headwinds, and the challenge of right-sizing its massive network. Until margins stabilize and revenue starts growing again, the fundamentals reflect a company in a period of stress rather than strength.
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