Online Delivery, COVID Vax Shipments Spur UPS Q2 Success

The continued growth of eCommerce deliveries, increases in air shipments and record levels of parcels requiring special handling — including COVID-19 vaccines — were key factors in the higher-than-expected revenues reported Tuesday (July 27) by United Parcel Service.

UPS reported total revenue of $23.42 billion for the quarter that ended June 30, up 14.5 percent from the same time last year — and now that online shopping has become the preferred method for many people to buy their goods, this isn’t likely to be a one-quarter blip for UPS and others in the space.

Healthcare deliveries buoyed UPS numbers in a big way in the second quarter, and more Americans are getting vaccinated every day, especially with increasing mandates related to working in or entering buildings without vaccinations as the Delta variant of the coronavirus continues its advance.

UPS revenue was up 10.2 percent in the U.S. domestic unit. International sales were up 30 percent as compared to 2020 in the three-month period, with European deliveries making up the lion’s share of that increase.

UPS seems to have finally moved past the shipping woes that plagued the company and its competitors during the 2020 holiday shopping season, when e-commerce reached new heights because most shoppers were still waiting to be cleared to return to malls and other shopping centers safely during the pandemic.

The company is also experimenting with same-day delivery services, with a pilot program in progress.

“We don’t have this all figured out, but we’ve got a team of people looking at it,” Chief Executive Carol Tomé said, per The Wall Street Journal, citing her response to a question on an investor-day webcast earlier this week. She added that UPS is piloting the concept, but didn’t elaborate further.

Adding same-day delivery helps UPS catch up to a delivery and logistics market where same-day services are becoming an increasingly common offering. Its largest rival, FedEx, already offers same-day delivery in some locations, and has been testing the use of robots to beef up its local delivery offerings.