UPS has unveiled plans to cut up to 30,000 jobs in 2026 as it intensifies its move away from low-profit Amazon deliveries, aiming to refocus on more lucrative segments such as healthcare. The announcement, made during an earnings call on Tuesday, January 27, 2026, highlights the parcel giant’s strategic pivot amid a competitive logistics landscape.
The job reductions will primarily affect operational roles and be achieved through attrition, coupled with a voluntary separation program for full-time drivers. This approach is designed to minimize involuntary layoffs while streamlining the workforce. UPS Chief Financial Officer Brian Dykes emphasized that the cuts are part of a broader effort to enhance profitability by shedding less profitable business lines.
This decision is rooted in the company’s long-standing concern over Amazon shipments, which UPS has labeled “extraordinarily dilutive” to its margins. By scaling back these deliveries, UPS seeks to allocate resources to higher-margin customers, including those in the healthcare sector, where demand for reliable shipping is growing. The shift began in earnest last year, with 48,000 jobs eliminated and 93 facilities closed as part of an initial turnaround plan.
Financially, UPS enters this transition from a position of strength. The company reported fourth-quarter consolidated revenue of $24.5 billion, surpassing analyst expectations, and forecasted a surprise increase in annual revenue to $89.7 billion for 2026. These figures suggest that despite the operational changes, UPS is maintaining robust performance, with shares rising slightly in response to the news.
The broader context includes UPS’s ongoing “Amazon accelerated glide down plan,” which aims to reduce daily shipments for the e-commerce giant by a million pieces in 2026. CEO Carol Tome noted that the company is in the final six months of this plan, with network reconfiguration efforts continuing to optimize efficiency. This strategic withdrawal from Amazon reflects a calculated bet on future growth areas.
Competitively, the move underscores the rapid evolution of the delivery industry. Amazon has significantly expanded its own logistics network, handling 6.3 billion U.S. deliveries in 2024 and projected to overtake the U.S. Postal Service by 2028. UPS’s pivot away from Amazon shipments is a direct response to this encroachment, aiming to avoid dependency on a rival that increasingly competes in the same space.
On the operational front, UPS plans to close an additional 24 facilities in the first half of 2026, further consolidating its network. The company also announced the retirement of its MD-11 cargo fleet following a fatal crash in November, incurring a $137 million write-off. These steps are part of a comprehensive effort to modernize operations and improve safety standards.
Looking ahead, UPS expects revenue to dip in the first half of 2026 as it completes the Amazon reduction, with a sequential rise anticipated in the second half. Analysts, such as Evercore ISI’s Jonathan Chappell, have praised the company’s pricing strategies and revenue performance. For the workforce, the changes mean a leaner organization, but with a focus on voluntary transitions and attrition, UPS aims to manage the impact thoughtfully. This strategic reshuffle positions UPS to navigate a dynamic global trade environment and geopolitical uncertainties while chasing higher profitability.
