Logistics giant UPS said Tuesday it would cut about 12,000 jobs worldwide, shortly after reporting quarterly revenues that disappointed analysts.
In a conference call, CEO Carol Tome said the company was seeking to “align” its resources with UPS’ priorities, adding that the cuts would save it around $1 billion in costs this year.
Three-quarters of the reductions are set to come in the first half, Tome noted. UPS has around 500,000 employees.
The chief executive also said that the layoffs mark a change in the way that the company works, in that these jobs are not expected to come back even if business volume rises again.
The announcement came shortly after UPS reported that its quarterly revenues were $24.9 billion for the fourth quarter of 2023, 7.8 per cent below the same period in 2022.
This was markedly less than the $25.4 billion figure that analysts expected as well.
For the full year, UPS reported a revenue fall of 9.3 per cent to $91 billion.
“2023 was a unique and difficult year and through it all we remained focused on controlling what we could control, stayed on strategy and strengthened our foundation for future growth,” Tome said in a statement.
In particular, the company noted drops in average daily volumes, both in its domestic and international business segments — bogging down its revenues.
For the final quarter last year, UPS reported earnings per share of $1.87.