UPS Narrowly Leads FedEx in Market Value Amid Ongoing Struggles

UPS's market value lead over FedEx has narrowed to its smallest ever after a 29% decline in UPS shares this year. The Atlanta-based company is struggling with high costs and uncertain trade policies, and has not provided revenue or operating profit guidance for 2025. Despite a modest earnings miss, analysts are concerned about the company's future performance due to a lack of visibility for the rest of the year.

Title: UPS's Market Value Lead Over FedEx Narrows Amidst Cost Pressures and Trade Uncertainty

UPS's market value lead over FedEx has narrowed to its smallest ever after a 29% decline in UPS shares this year. The Atlanta-based company is grappling with high costs and uncertain trade policies, and it has not provided revenue or operating profit guidance for 2025. Despite a modest earnings miss, analysts are concerned about the company's future performance due to a lack of visibility for the rest of the year.

UPS reported a 29% decline in its share price this year, which has significantly narrowed its market value lead over FedEx. The company faced challenges in the second quarter of 2025, with higher-than-expected costs for its Ground Saver service, which used to rely on the USPS before a breakup this year [1]. This service posed challenges for UPS, contributing to its financial difficulties.

The company's second quarter financial results showed a modest earnings miss, with reported EPS of $1.55, slightly below expectations of $1.56. Despite this, UPS's operating profit was $1.9 billion, and the operating margin was 8.8% [2]. The company's CEO, Carol Tome, acknowledged the impact of a complex macro environment and the significant actions taken to strengthen UPS's competitive and financial positioning.

However, analysts are concerned about the company's future performance due to a lack of visibility for the rest of the year. UPS has not provided revenue or operating profit guidance for 2025, which has raised questions about its ability to navigate the uncertain trade policies and high costs affecting the logistics sector.

UPS's struggles are not isolated. The logistics industry as a whole is facing challenges, with ground delivery costs hitting record highs and carriers like FedEx and UPS discounting their services [3]. Additionally, the US Postal Service (USPS) has been facing its own challenges, with issues related to shipping platform overcharging and potential business losses [4].

Despite these challenges, UPS has been exploring ways to improve its last-mile delivery services. The company has been working on reuniting with the USPS for its Ground Saver service and has also been exploring partnerships with other delivery providers to expand its reach [1]. These efforts are aimed at reducing costs and improving efficiency in its delivery network.

In conclusion, UPS's market value lead over FedEx has narrowed significantly this year due to high costs and uncertain trade policies. The company's financial results showed a modest earnings miss, but analysts are concerned about its future performance due to a lack of visibility for the rest of the year. UPS is taking steps to improve its last-mile delivery services and reduce costs, but the challenges in the logistics sector remain significant.

References:
1. [1] https://www.supplychaindive.com/topic/last-mile-delivery/
2. [2] https://www.insidermonkey.com/blog/united-parcel-service-inc-nyseups-q2-2025-earnings-call-transcript-1579092/
3. [3] https://www.supplychaindive.com/topic/last-mile-delivery/
4. [4] https://www.supplychaindive.com/topic/last-mile-delivery/