Analyst Note| Matthew Young, CFA |
Small-package delivery giant UPS' third-quarter revenue increased 16% year over year. Similar to last quarter, the pandemic has accelerated the broader shift to e-commerce sales for retailers, materially boosting residential deliveries. Also, robust airfreight demand out of Asia remains a tailwind for the international package and global forwarding units. Total package yield was roughly flat on lower fuel surcharges and mix, but core pricing remains nicely positive as UPS’ pricing power is enjoying a boost from constrained industry capacity. B2B activity improved sequentially but is still dealing with soft industrial end markets.