UPS Unveils Ambitious Growth Strategy at 2024 Investor Day, Targets $114 Billion Revenue by 2026 Amid Market Reset

United Parcel Service, Inc. Class B -2.30% Post

United Parcel Service, Inc. Class B





-0.04% Post

United Parcel Service, Inc. (NYSE:UPS) hosted its 2024 Investor and Analyst Day in Louisville, the heart of its global operations, laying out an aggressive growth and productivity plan for the next three years. CEO Carol Tomé and her executive team presented a detailed roadmap to achieve a consolidated revenue target of $108 billion to $114 billion by 2026, emphasizing the company's commitment to becoming the premium small package and logistics provider.

The event, which took place on March 26, 2024, featured presentations from key UPS leaders, including Chief Financial Officer Brian Newman, who confirmed the company's 2024 guidance and outlined the financial targets for the coming years. UPS expects a challenging first half in 2024, with a projected decline in average daily volume and revenue, followed by a rebound in the latter half of the year. The company's "1 + 2 plan" focuses on volume, revenue, and operating profit dollar growth in the first year, with subsequent years emphasizing operating margin growth, aiming for a consolidated operating margin of 13% by 2026.

Tomé highlighted the company's strategic initiatives, including the sale of UPS Freight, the acquisition of digital companies, and the review of strategic alternatives for Coyote, a subsidiary of UPS. The company's growth strategy is centered around enhancing its integrated network, leveraging technology, and focusing on high-margin segments such as healthcare logistics and international package delivery.

The UPS team also discussed the impact of external factors such as inflation, geopolitical tensions, and market conditions on the company's performance. Despite these challenges, UPS has made significant strides in improving its brand relevance and employee satisfaction, with 65% of UPSers recommending the company as a place to work, a 14 percentage point improvement over four years.

Innovation and technology were central themes, with Chief Digital and Technology Officer Bala Subramanian detailing investments in RFID, automation, robotics, and digital platforms. These initiatives are expected to drive operational agility and efficiency, contributing to the company's productivity goals.

The company's commitment to sustainability and diversity was also underscored by the presence of Chief Corporate Affairs and Sustainability Officer Laura Lane and Chief Human Resources and Chief Diversity, Equity, and Inclusion Officer Darrell Ford.

As UPS gears up for the next three years, the company is poised to disrupt the logistics industry through reimagination and a relentless focus on customer-first, people-led, and innovation-driven strategies.

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