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UPS announces major workforce reduction
Delivery giant UPS plans to eliminate up to 30,000 positions in 2026 as it continues to scale back business with its largest client, Amazon. The company cited shrinking profit margins from Amazon shipments as the primary driver behind the cuts.
How the cuts will unfold
UPS will offer voluntary buyouts to full-time drivers and avoid replacing employees who leave voluntarily. The move follows a broader restructuring effort that saw 48,000 jobs cut and 93 facilities closed in 2025. An additional 24 facilities are slated for closure in the first half of this year.
Financial performance amid restructuring
Despite the job reductions, UPS reported $24.5 billion (£17.7 billion) in earnings for the last quarter of 2025. The company also projected a revenue increase to $89.7 billion for 2026, exceeding earlier expectations.
"We're in the final six months of our Amazon accelerated glide down plan and for the full year 2026, we intend to glide down another million pieces per day while continuing to reconfigure our network."
Carol Tomé, UPS Chief Executive
Shift away from Amazon
UPS has been reducing its reliance on Amazon as part of a strategy to focus on more profitable sectors, such as healthcare. The company described Amazon deliveries as "extraordinarily dilutive" to its earnings. In 2024, UPS employed approximately 490,000 workers, including nearly 78,000 in management roles, with much of its workforce unionized.
Fleet changes and safety measures
UPS also announced the permanent retirement of its MD-11 cargo planes, which accounted for about 9% of its fleet. The decision follows a fatal crash in Louisville, Kentucky, in November 2025, after which the planes were grounded.
Amazon's growing delivery dominance
Amazon has rapidly expanded its in-house delivery operations, challenging UPS, FedEx, and the U.S. Postal Service (USPS). In 2024, Amazon handled 6.3 billion deliveries in the U.S., surpassing both UPS and FedEx. By 2028, Amazon is expected to overtake USPS in total U.S. delivery volume, according to Pitney Bowes' parcel shipping index.
Market reaction
UPS shares closed slightly higher in New York trading on Tuesday following the announcements.
