The #UPS Q3 Earnings Call highlighted what a disciplined company looks like - one which has clearly prioritized and optimized for higher-margin SMB small parcel volume.

Finally higher revenue, profit, while decreasing direct labor hours and trailerloads is a study in focused, prioritized execution.

These metrics tell the story:

- Revenue up 9.2% to last year.

- Profit grew 22.6% - US SMB up 10.9% y/y (one of most profitable segments) — all SMB segments growing.

- Eliminating 10% of daily trailer loads y/y by improving cube utilization

- Decrease in direct labor hours/day 5.1%

They threw sand in the face of #FedEx when they said:

- “there are higher labor costs and we are managing it”

- Will control volume entering network to eliminate “chaos costs”

Contrast that with FedEx:

- higher labor costs means we can’t hire, which means we had tons of unexpected costs.

On parcel volume:

“We used to think every package was the same. We don’t think that anymore.”

I think this is the shift away from freight and Enterprise high-volume customers and towards SMB.

On “the largest customer” (#Amazon), CEO Carol Tome: - “We are part of their supply chain, not their entire supply chain”.