United Parcel Service (UPS) - Get Report on Wednesday delivered third-quarter earnings that well surpassed analysts' forecasts as consumers and businesses continued to turn to Big Brown to get their packages from point A to point B amid the coronavirus pandemic.
The Atlanta-based delivery company posted adjusted net income of $1.96 billion, or $2.24 a share, vs. adjusted income of $33 million, or 4 cents a share, in the comparable year-ago quarter. Analysts polled by FactSet had been expecting earnings of $1.90 a share.
Revenue increased 15.9% to $21.2 billion, above the $18.3 billion in brought in a year ago and a solid $1 billion above analysts' forecasts of $20.2 billion. In the U.S., operating profit came in at $2.4 billion, up 11% from a year ago.
The better-than-expected numbers reflect the dramatic shift to having goods delivered door to door amid the global pandemic that has spurred one of the most dramatic shifts in commerce in history.
CEO Carol Tome specifically pointed to "continued strong outbound demand from and growth from small and medium-sized businesses” as reason for the strong uptick in sales and earnings, something that is expected to continue in the fourth quarter ahead of what is anticipated to be a record-breaking online holiday shopping season.
Even then, the company chose not to provide a forecast for its fourth-quarter earnings, citing "uncertainty around the timing and pace of the economic recovery" and the inability "to predict the extent of the business impact or the duration of the coronavirus pandemic, or reasonably estimate operating performance in future quarters."
U.S. package revenue rang in at $13.22 billion, an increase of 15.5% year over year, while international package revenue was $4.08 billion, up 17% from a year ago. Average daily volume increased 13.5%.
Cash from operations over the first nine months of the year totaled $9.3 billion, while adjusted free cash flow came in at $5.9 billion.
Shares of UPS were down 5.81% at $160.92 in trading on Wednesday.