FedEx vs UPS: Revenue, Profitability & Business Model Compared
Side-by-side comparison of FedEx (FDX) and UPS (UPS). Compare revenue breakdowns, profitability, financial metrics, and logistics business models.
FedEx vs UPS Overview
America’s logistics duopoly: FedEx pioneered express delivery and focuses on B2B shipping, while UPS built integrated ground and air networks with strong labor union relationships.
| Metric | FedEx (FDX) | UPS (UPS) |
|---|---|---|
| Sector | Logistics | Logistics |
| Market Cap | $65B | $100B |
| Revenue | $87.7B | $91.1B |
| Net Income | $4.3B | $5.8B |
How Does FedEx Make Money?
FedEx (FDX) operates in the Logistics sector with a market cap of $65B. For a full breakdown of FedEx’s revenue sources, see the FedEx revenue breakdown.
FedEx Revenue Breakdown
| Segment | FY2024 (May) | FY2023 (May) | YoY Growth |
|---|---|---|---|
| Federal Express | $69.0B | $69.2B | -0.3% |
| FedEx Ground | $27.1B | $26.5B | +2.3% |
| FedEx Freight | $9.0B | $9.4B | -4.3% |
| FedEx Services | $0.4B | $0.4B | +0.0% |
| Eliminations | -$17.8B | -$17.5B | N/A |
| Total Revenue | $87.7B | $90.2B | -2.8% |
How Does UPS Make Money?
UPS (UPS) operates in the Logistics sector with a market cap of $100B. For a full breakdown of UPS’s revenue sources, see the UPS revenue breakdown.
UPS Revenue Breakdown
| Segment | FY2024 | FY2023 | YoY Growth |
|---|---|---|---|
| U.S. Domestic Package | $57.5B | $56.3B | +2.1% |
| International Package | $17.3B | $18.9B | -8.5% |
| Supply Chain Solutions | $16.3B | $15.8B | +3.2% |
| Total Revenue | $91.1B | $91.0B | +0.1% |
FedEx vs UPS Profitability
FedEx: Yes, FedEx is profitable. The company reported net income of $4.3B on total revenue of $87.7B. With an operating margin of 7.0%, FedEx is improving margins through its DRIVE cost reduction program.
UPS: Yes, UPS is profitable. The company reported net income of $5.8B on total revenue of $91.1B. With an operating margin of 9.5%, UPS demonstrates superior cost efficiency despite higher labor costs.
Key Financial Metrics Comparison
FedEx Key Metrics
- Gross Margin: 28.5% — Transportation-intensive business model.
- Operating Margin: 7.0% — Improving through DRIVE transformation.
- DRIVE Savings: $4B — Major cost reduction initiative underway.
- Express Volume: Declining — Structural shift away from air to ground.
UPS Key Metrics
- Gross Margin: 32.0% — Higher efficiency through integrated network.
- Operating Margin: 9.5% — Best-in-class for logistics.
- Revenue per Piece: $13.50 — Strong pricing power.
- U.S. Market Share: 25% — Dominant position in domestic shipping.
Which Company is a Better Investment?
UPS offers superior margins and dividend yield with a more efficient network. FedEx provides turnaround potential through cost cutting and network consolidation. Both face secular headwinds from e-commerce shippers seeking alternatives and Amazon’s logistics buildout. Review the full FedEx revenue breakdown and UPS revenue breakdown for detailed analysis.
Disclaimer: This comparison is for informational purposes only and does not constitute investment advice.