UPS is preparing to lay off approximately 20,000 employees and close more than 70 buildings as it significantly scales back the volume of packages it handles from Amazon.
The company announced on Tuesday that these job reductions are expected to take place this year, and it plans to close 73 of its leased and owned facilities by the end of June. UPS also noted it is continuing to evaluate its network and may identify additional closures in the coming months.
“These steps to restructure our operations and reduce expenses couldn’t come at a better time,” said CEO Carol Tomé. “While economic conditions remain uncertain, our strategic actions will help us become a more agile and efficient UPS.”
Earlier in January, UPS disclosed that it had renegotiated its longstanding relationship with Amazon—its largest customer—agreeing to reduce package volume from the online retailer by over 50% by the second half of 2026.
During the company’s fourth-quarter earnings call, Tomé emphasized that although UPS had worked with Amazon for nearly three decades, the decision to revisit the partnership was based on financial strategy.
“Amazon is our largest customer, but not the most profitable,” she said. “Its margin significantly reduces our domestic profitability.” UPS evaluated several scenarios and ultimately concluded that downsizing Amazon volume was the best option.
UPS currently employs about 490,000 people, according to data from FactSet.
The Atlanta-based shipping giant also released its financial results for the first quarter on Tuesday. It reported a net income of $1.19 billion, or $1.40 per share, for the period ending March 31. Excluding specific items, adjusted earnings were $1.49 per share—topping analysts’ expectations of $1.44 per share, according to Zacks Investment Research.
Quarterly revenue reached $21.55 billion, also beating Wall Street’s forecast of $21.06 billion.
Due to ongoing economic uncertainty, UPS said it would not be revising its previously issued full-year guidance. The company had earlier projected 2025 revenue to be around $89 billion.
UPS shares saw a modest uptick in morning trading following the announcement.
