ATLANTA (AP) – UPS lowered its outlook for the year as it announced plans to spend more on technology and other enhancements to improve service during peak season.
UPS said it will spend $175 million on upgrades that include expanded operations on the day after Thanksgiving and sped-up deployment of software designed to help drivers find the quickest route to a destination.
During last year’s holiday season, a big increase in online shopping and a crush of last-minute orders by shoppers who jumped on offers of free shipping caught UPS by surprise. The company was forced to hire extra workers to handle the rush, but some gifts still arrived late.
As a result of the boost to spending, UPS lowered its full-year outlook for adjusted earnings to $4.90 to $5 a share. It previously expected to earn around $5.05 a share. Shares fell $2.95, or 2.9 percent, to $99.71 in premarket trading.
The Atlanta-based company also said second-quarter profit declined to $454 million, or 49 cents per share, from $1.07 billion, or $1.13 per share, in the same quarter a year earlier.