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UPS CEO Gives a Nod to Amazon, Ecommerce Platforms

UPS shipping
UPS CEO Gives a Nod to Amazon, Ecommerce Platforms

UPS said consolidated average daily volume increased 10.6% in the fourth quarter of 2020 (October through December) compared to Q4 2019. But consolidated revenue was up 21%, to $24.9 billion.

In the US, UPS said revenue increased 17.4%, led by growth from small and medium-sized businesses, while revenue per piece increased 7.8% driven by Ground residential.

In a post-earnings call with Yahoo Finance on Tuesday, CEO Carol Tome referenced the higher revenue-versus-volume growth, saying it reflected the company’s “better not bigger” strategy. She also referenced Stamps.com, Shopify, and eBay in touting UPS’s Digital Access Program that “leans into these platform businesses in a big way. We’ve seen tremendous growth in this space.”

MarketWatch noted Tomé’s discussion of Amazon, which is its largest customer. Amazon accounted for 13.3% of UPS total revenue in 2020, up from 11.6% in 2019, MarketWatch reported. “With UPS reported total 2020 revenue of $84.63 billion, that indicates Amazon accounted for $11.26 billion in 2020 revenue, up from $8.59 billion a year ago.” (It didn’t say if Tome felt Amazon was a rival as well as a competitor.)

CNBC’s headline summed up UPS Q4 earnings as follows: “UPS shares jump on strong fourth-quarter earnings as Covid drives online shopping” and noted: “On top of holiday deliveries, UPS and rival FedEx began shipping Covid vaccines from Pfizer and Moderna across the U.S. in December, bolstering their health-care delivery businesses. (CEO) Tome said UPS has been able to provide “above 99% service” for Covid vaccine deliveries so far.”

The full financial press release is on the UPS website.

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Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). She is a member of the Online News Association (Sep 2005 - present) and Investigative Reporters and Editors (Mar 2006 - present). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com. See disclosure at EcommerceBytes.com/disclosure/.