By Paul Ziobro
United Parcel Service Inc. benefited from a continued surge in overnight air deliveries in the third quarter as online merchants and their shoppers increasingly desire faster shipping times.
The delivery company also announced the departure of Chief Operating Officer Jim Barber, who since his appointment to the role in March 2018 was viewed as the top candidate to replace Chief Executive Officer David Abney. Mr. Barber, age 59, is retiring at the end of the year, the company said, opening up the CEO succession race.
Mr. Barber, a 35-year UPS veteran, returned to the U.S. from a long stint working internationally to help improve performance in domestic operations. His promotion to COO made him a CEO-in-waiting, as Mr. Abney previously held that position briefly before becoming CEO in 2014.
Citi analyst Christian Wetherbee said Mr. Barber was "well-liked by the investment community" and that losing an executive "seen as an operational catalyst likely will weigh on shares."
Shares fell 4.8% in recent premarket trading to $113.86.
UPS said the high demand for next-day shipping, with volume up 24% in the U.S., and strong cost management helped the company boost profit in the period. Overall U.S. volume rose 9%.
Overseas, FedEx's international business posted a decline in revenue amid a drop in shipments between the U.S. and Asia. Other shipments inside Europe and in other Asia trade lanes grew.
For the period, the Atlanta-based shipper posted quarterly earnings of $1.75 billion, or $2.01 a share, up from $1.51 billion, or $1.73 a share, a year earlier. Excluding certain transformation costs, per-share earnings were $2.07, slightly topping the estimate of analysts polled by FactSet.
Revenue increased 5% from the year prior to $18.32 billion, slightly under the consensus estimate.
The company backed its earnings guidance for the year.
Micah Maidenberg contributed to this article.
Write to Paul Ziobro at Paul.Ziobro@wsj.com
(END) Dow Jones Newswires
October 22, 2019 09:21 ET (13:21 GMT)Copyright (c) 2019 Dow Jones & Company, Inc.