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Good morning. About a year ago, I first spoke with UPS CFO Brian Dykes about the company’s strategic pivot: shedding lower-return, capital-intensive delivery volume, including scaling back its decades-long partnership with Amazon, to focus on customers where UPS could add more value. With much of that transformation completed, the strategy is beginning to pay off: UPS’s core volume returned to growth in the third quarter, exceeding expectations.
“The strategy is coming to life,” Dykes told me Tuesday following the earnings call. We discussed the transformation and preparations for the holiday season.
UPS (No. 48 on the Fortune 500) reported third-quarter 2026 revenue of $22.9 billion, compared to $22.29 billion expected, and operating profit of $1.7 billion, or $2.1 billion on an adjusted basis. Diluted earnings per share were $1.37, compared with adjusted earnings of $1.69. The company also raised its full-year revenue, profit, and free-cash-flow guidance for the second consecutive quarter.
Growth came from the customer segments UPS has prioritized. U.S. small and midsize business volume increased 3.7%, while enterprise volume grew approximately 1%, Dykes said. High-tech and health care shipments helped drive performance, while investments in Asia’s air network supported international growth.
One emerging opportunity is data center construction. Dykes said that beyond transporting chips and computers, UPS can move cooling systems, flooring, racks, and other industrial equipment needed to build facilities. Its advantage, he said, is connecting freight forwarding, logistics, and package delivery within its own network. UPS has organized sales teams around the opportunity and is pursuing roughly 100 active prospects.
Staying the course through uncertainty
But capturing growth required staying committed to the strategy through uncertainty.
“There have been a lot of times when we’ve questioned, are we doing the right thing?” Dykes said. The eight-person leadership team led by CEO Carol Tomé drew on the company’s 119-year legacy and predecessors who had the “courage to drive change.”
“We’re all aligned on how we’re executing the strategy, even when the stock price wasn’t necessarily reflecting that people liked it,” Dykes said.
UPS shares rebounded from a low of $88.22 on Oct. 27, 2025, to an intraday high of $122.41 on Feb. 12, 2026. Following its third-quarter 2026 earnings report, the stock rose 5.75% to close at $106.09 on Tuesday.
“We’re not all the way there,” Dykes said. “We still have more to do. But I think we’re starting to put some points on the board.”
Preparing for the holiday surge
Dykes measures progress beyond margins and operating leverage, tracking whether priority customers account for a growing share of volume, operations become more productive, and service quality remains strong. Otherwise, he said, new business can become what he calls a “leaky bucket”—adding customers while losing existing ones.
The next test is the holiday shipping season. UPS expects U.S. daily volume to rise approximately 25% from the third to the fourth quarter. So, the company is targeting 100,000 seasonal hires in the U.S. to help handle an additional 4 million pieces per day. UPS will try to hire at least 40,000 people during its peak hiring weekend, November 6–7, so that “we can get them onboarded and working through the holidays,” Dykes said.
With less of lower-return e-commerce volume, UPS expects to need fewer rented aircraft, trailers, and trucks to handle the surge.
“We will have to do a little bit less work to make the same amount of money,” Dykes said.
That is the central promise of the transformation: not simply moving more packages, but earning better returns from the packages UPS chooses to move.
Sheryl Estrada
Sheryl.Estrada@fortune.com
Leaderboard
Fortune 500 Power Moves
Jerome Rouquet was appointed CFO of The Goodyear Tire & Rubber Company (No. 239), effective Dec. 1. Rouquet is an experienced global finance executive. He currently serves as CFO of Visteon Corporation. Before joining Visteon in 2020, he held senior finance leadership positions at Tenneco and Federal-Mogul, including serving as Federal-Mogul’s CFO, chief accounting officer and controller. Scott Deakin, who has served as interim CFO, will continue in the role until Rouquet joins the company.
The weekly Fortune 500 Power Moves column tracks Fortune 500 company C-suite shifts—see the most recent edition.
More notable moves
Daniel Gittsovich was appointed CFO of Sierra Space, a defense-tech space company. He succeeds Jeff Schrader, who was appointed CFO in June 2026. Gittsovich joins Sierra Space from L3Harris Technologies, where he most recently served as vice president and CFO of its Missile Solutions business. Before joining L3Harris, Gittsovich spent more than five years at 3M, holding several leadership roles in corporate strategy and business development, including within the company’s Safety & Industrial Business Group. Earlier in his career, he held investment banking positions at Deutsche Bank, Bank of America Merrill Lynch, and Bentley Associates.
Jerome Rouquet, SVP and CFO of Visteon Corporation (Nasdaq: VC), will leave the company Nov. 30, 2026 to pursue other opportunities. Colleen Myers, the company’s VP and chief accounting officer, was appointed interim CFO, effective following Rouquet’s departure. The company has initiated a search for a permanent successor. Myers has served as VP and CAO since January 2024. She joined Visteon in 2015 and has held several finance leadership roles, including assistant controller and senior manager of reporting and consolidations.
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Overheard
“If AI agents and technology are going to make employment increasingly uncertain, shouldn’t we at least get the human part right?”
—Paul Hardart, a professor at NYU Stern School of Business, writes in a Fortune opinion piece.
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Sheryl Estrada
