United Parcel Service (UPS) shares plummeted 5.70% in pre-market trading on Tuesday following the release of disappointing second-quarter earnings results and ongoing economic uncertainties. The global shipping giant reported lower profits and revenues compared to the same period last year, falling short of analysts' expectations.

UPS announced consolidated revenues of $21.2 billion for Q2 2025, representing a 2.83% decrease from the $21.82 billion reported in the same quarter of the previous year. The company's adjusted earnings per share (EPS) came in at $1.55, missing the analyst consensus estimate of $1.56 and marking a significant 13.41% decline from the $1.79 per share earned in Q2 2024. Despite the revenue beat, with actual figures surpassing the estimated $20.87 billion, investors seemed more focused on the earnings miss and broader economic concerns.

Adding to the bearish sentiment, UPS refrained from providing full-year revenue or operating profit guidance, citing "current macro-economic uncertainty." This lack of forward-looking financial projections has likely contributed to investor unease. The company also faces headwinds from new "de minimis" tariffs on low-value Chinese shipments, which are expected to impact consumer demand. UPS CFO reported that U.S. trade policy changes during the quarter resulted in a 34.8% decline on their China to U.S. lane in May and June, higher than expected. These factors, combined with mounting risks from ongoing trade policy shifts, appear to be weighing heavily on investor confidence.

Furthermore, UPS is grappling with a significant decline in Amazon-related volume. The company's CFO stated that they expect to accelerate the pace of Amazon volume decline to approximately 30% year-over-year in each of Q3 and Q4. In response to this trend, UPS CEO announced plans to close more buildings and sort centers during the second half of the year. The company's low-cost Ground Saver product volume also fell 23% year-over-year, partly due to fewer Amazon delivery reductions.