What Do These UPS Earnings Say About the Economy?

The world’s largest delivery company and economy bellwether United Parcel Service Inc. (NYSE:UPS) missed both earnings and revenue forecasts for the first quarter even though it improved on both counts over the year-ago period.

Net earnings climbed 6 percent to $970 million ($1 per share) from $915 million (91 cents a share) in the year-ago period, slightly off analysts’ expectations of $1.02 a share.

Revenues grew 4.4 percent to $13.14 billion, missing the market forecast of $13.26 billion. Domestic revenues grew 6.2 percent while international revenues rose only 2.3 percent.

“Increases in revenue per piece caused by higher base rates and fuel surcharges were mostly offset by changing product and customer mix as lower-margin e-commerce continued to drive volume growth in the domestic business,” UPS said. Per unit revenue in the international segment was hurt by volume weakness in Asia and higher intra-regional movements.

For the full year, UPS expects no change in its earlier guidance of earnings per share of $4.75 to $5.00 a share.