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• The company’s shares fell as low as 4.5% after the company hinted at slower e-commerce growth
United Parcel Service (NYSE: UPS) reported higher revenue for the first quarter of 2022, topping analysts' expectations, but shares fell as much as 4.6% after executives said they expected e-commerce delivery growth to cool.
Shares of the company fell as low as 4.5% after the announcement.
In a conference call with analysts, CEO Carol Tome said, “We're not going to see the kind of (e-commerce) growth that we experienced during COVID, clearly, but e-commerce sales will continue to grow.”
The company said that higher shipping rates, fuel surcharges, and more large and small business deliveries would offset softer e-commerce demand, as they did in the first quarter.
Average daily volume in the UPS domestic business fell 3%, or 611,000 packages per day, for the quarter ended March 31. This figure included a 7.4% drop in residential deliveries as compared to last year.
Consolidated revenue rose 6.4% to $24.4 billion exceeding the market expectation of $23.78 billion. Adjusted earnings were reported as $3.05 per share versus the average analysts’ expectations of $2.88 per share.
The company reaffirmed its full-year revenue forecast of about $102 billion. It expects a consolidated adjusted operating margin of about 13.7% and an adjusted return on invested capital above 30%.
It also announced plans to double its 2022 share buyback target to $2 billion.
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Source: UPS