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UPS Credits Healthcare Customers For 6.7% Revenue Increase

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UPS Credits Healthcare Customers For 6.7% Revenue Increase

UPS is crediting its healthcare and small business customers with an uptick in revenue as it prepares for a surge in holiday eCommerce demand.

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The delivery giant reported quarterly earnings Tuesday (Oct. 27) showing a 6.7% in overall revenue, driven by an 18.2% increase in supply chain revenue from growth in forwarding and logistics, including healthcare.

Small- to medium-sized businesses (SMBs) represent an expanding share of shipping activity, accounting for 35.1% of UPS’ total U.S. volume in the quarter.

Driving much of that SMB momentum is the growth of digital platforms like UPS’s Digital Access Program (DAP), which reached $1.4 billion in global revenue as more merchants opt to use premium air and commercial ground services.

At the same time, logistics demand is shifting toward specialized, high-margin verticals, including healthcare, automotive, and high-tech manufacturing. The rise of data centers is creating significant new supply chain requirements, said CEO Carol Tomé.

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“With the explosion of data center growth here in our country, the logistics opportunities are enormous,” she told analysts. “In fact, we estimate the logistics opportunities associated with data centers alone is $15 billion.”

Looking ahead to the holiday season, Tomé pointed to industry forecasts for online retail sales projecting a 9% increase over last year, with UPS anticipating its average daily volume to increase approximately 25% from the third quarter to the fourth quarter from its top 100 surge customers, which account for roughly 80% of peak volume.


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