UPS has said it will cut up to 30,000 jobs this year as it continues to reduce deliveries for its biggest customer, Amazon, which the package giant says is severely hurting profitability.
The world’s largest package delivery company said the job cuts will be achieved primarily through voluntary buyout offers for full-time drivers and by not replacing employees who leave the company. The move is part of a broader turnaround strategy aimed at reshaping the UPS network and focusing on higher-margin customers.
UPS said Amazon shipments were “extraordinarily dilutive” to profit margins, prompting the company to consciously reduce its exposure to the online retailer. Last year, UPS announced it would reduce its reliance on Amazon and focus on more profitable sectors such as healthcare and time-critical logistics.
Chief executive Carol Tomé said the company was nearing the end of its planned drawdown.
“We are in the final six months of our accelerated Amazon slide-down plan, and for the full year of 2026 we intend to shut down an additional million units per day while continuing to reconfigure our network,” she said.
The announcement was accompanied by financial results that exceeded expectations. UPS reported revenue of $24.5 billion (£17.7 billion) for the final quarter of last year and forecast a surprise rise in full-year sales to $89.7 billion in 2026, despite planned reductions in Amazon volumes.
The restructuring follows an aggressive cost-cutting program in 2025, when UPS cut 48,000 jobs and closed 93 facilities as part of the same strategy. The company said it would close an additional 24 facilities in the first half of this year to further streamline its operations.
According to its 2024 annual report, UPS employs approximately 490,000 people worldwide, including nearly 78,000 in management positions. A large part of the workforce is unionized.
In a separate move, UPS confirmed it is permanently retiring its fleet of MD-11 cargo planes following a fatal crash in Louisville, Kentucky, in November. The MD-11s, which make up about 9% of the company’s fleet, have been grounded since the incident.
UPS shares ended New York trading slightly higher on Tuesday following the announcement.
The strategic shift underscores the changing dynamics of the U.S. delivery market, where Amazon has been rapidly expanding its internal logistics network. In 2024, Amazon processed an estimated 6.3 billion deliveries in the United States, surpassing both UPS and FedEx. Amazon is expected to overtake the U.S. Postal Service as the country’s largest delivery provider by 2028, according to the Pitney Bowes Package Shipping Index.
UPS said reducing its reliance on Amazon would allow it to improve its margins, simplify operations and build a more resilient business model focused on premium and specialized logistics services.
