United Parcel Service (UPS) 10-K risk factor changes: FY2023 vs FY2022

We conduct operations in over [removed: 220] [added: 200] countries and territories.

Our operations are subject to [removed: cyclicality affecting] national and international [removed: economies in general,] [added: economic factors,] as well as the local economic environments in which we operate.

Changes in general economic conditions are beyond our control, and it may be difficult for us to adjust our business [removed: model to mitigate the impact of these factors.][added: model.]

For example, we are affected by [removed: levels of] industrial production, inflation, [removed: unemployment levels,] [added: unemployment,] consumer spending and retail [removed: activity.][added: activity levels.]

We [removed: could be] [added: have been, and may in the future be,] materially affected by adverse developments in these aspects of the economy.

We have also been, and may in the future be, adversely impacted by changes in general economic conditions [removed: as a result of] [added: resulting from] geopolitical uncertainty and/or conflicts in or arising from the countries [removed: and/or] [added: and] regions where we operate, including the United Kingdom, the European Union, [removed: the] Ukraine, the Russian [removed: Federation] [added: Federation, the Middle East] and the Trans-Pacific region.

Our industry [removed: is] [added: continues to] rapidly [removed: evolving,] [added: evolve,] including demands for faster [removed: deliveries and] [added: deliveries,] increased visibility into [removed: shipments.][added: shipments and development of other services.]

Competitors include the U.S. and [removed: other] international postal services, various motor carriers, express companies, freight forwarders, air couriers, large transportation and e-commerce companies that [removed: have made and] continue to make significant investments in their own logistics capabilities, some of whom are currently our customers.

We also face competition from start-ups and other smaller companies that combine technologies with flexible labor solutions such as [removed: crowdsourcing to focus on local market needs.][added: crowdsourcing.]

Competitors have cost, operational and organizational structures that differ from ours and may offer services or pricing terms that we are not willing [removed: or able] to offer.

Additionally, [removed: to sustain the level of service and value that we deliver to our customers,] from time to time we have raised, and may in the future raise, prices and our customers may not be willing to accept these higher prices.

If we do not [removed: timely and] appropriately respond to competitive pressures, including replacing any lost volume or maintaining our profitability, we could be materially adversely affected.

[removed: Continued transportation] [added: Transportation] market growth may further increase competition.

Business combinations could also result in competitors providing a wider variety of services and products at competitive prices, which could [added: also] materially adversely affect us.

For the year ended December 31, [removed: 2022, business from] [added: 2023,] one customer, Amazon.com, Inc. and its affiliates, accounted for [removed: 11.3%] [added: 11.8%] of our consolidated revenues.

Customer impact on our revenue and profitability [removed: is] [added: can vary] based on [removed: factors such as:] [added: a number of factors, including:] contractual volume amounts; pricing terms; product launches; e-commerce or other industry trends, including those related to the holiday season; business combinations and the overall growth of a customer's underlying business; as well as any disruptions to their businesses.

Customers could choose, and have in the past [removed: chosen,] [added: chosen,] to divert all or a portion of their business with us to one of our competitors, demand pricing [removed: concessions for our services, require us to provide] [added: concessions, request] enhanced services that increase our costs, or develop their own logistics capabilities.

We [removed: necessarily] depend on the skills and continued service of our [removed: employees.][added: large workforce.]

We also regularly [removed: seek to] hire a large number of part-time and seasonal workers.

We must be able to attract, [removed: engage,] develop and retain a large and diverse global [removed: workforce and maintain an environment that supports our core values.][added: workforce.]

If we are unable to hire, properly train or retain qualified employees, we could experience higher labor costs, reduced revenues, further increased workers' compensation and automobile liability [removed: claims,] [added: claims costs,] regulatory noncompliance, customer losses and diminution of our brand value or company culture, which could materially adversely affect us.

Our ability to control labor costs has in the past been, and is expected to continue to be, subject to numerous factors, including [added: labor-related contractual obligations,] turnover, training costs, regulatory changes, market pressures, inflation, unemployment levels and healthcare and other benefit costs.

Our inability to continue to retain experienced and motivated employees [added: through the execution of these initiatives] may also materially adversely affect us.

[removed: Customers] [added: As a result, customers have reduced, and in the future] may [removed: reduce] [added: reduce,] their business or stop doing business with us if they believe that such actions or threatened actions may adversely affect our ability to provide services.

The terms of [removed: future] collective bargaining agreements also may affect our competitive position and results of operations.

Furthermore, our actions or responses to any such negotiations, labor disputes, strikes or work stoppages could negatively impact how our brand is perceived and our [removed: corporate] reputation and have adverse effects on our business, including our results of operations.

[removed: Increased] [added: Increases in operational] security requirements impose substantial costs on us and we could be the target of an attack or have a security breach, which could materially adversely affect us.

As a result of concerns about global terrorism and homeland security, various governments have adopted and may [removed: continue to] adopt [removed: stricter] [added: additional heightened] security requirements, resulting in [added: significantly] increased operating costs.

We cannot determine the effect that any new requirements will have on our operations, cost structure or operating results, and new rules or other future security requirements may [added: significantly] increase our operating costs and reduce operating efficiencies.

Regardless of our compliance with security requirements or [removed: the steps we take to secure] our [removed: facilities or fleet,] [added: own security measures,] we could also be the target of an attack or security breaches could occur, which could materially adversely affect [removed: us.][added: one or more of our operations, or our business.]

A significant [removed: data breach] [added: cybersecurity incident,] or [removed: information technology system disruption] [added: increased data protection regulations,] could materially adversely affect us.

We rely on information technology [removed: ("IT")] networks and [removed: systems,] [added: systems and other operational technologies,] including the internet and a number of internally-developed systems and applications, as well as certain technology systems from third-party [removed: vendors,] [added: vendors (collectively referred] to [added: as "IT") to] operate our business.

For example, we rely on [removed: IT] [added: these technologies] to receive package level information in advance of the physical receipt of packages, to move and track packages through our operations, to efficiently plan deliveries, to execute billing processes, and to track and report financial and operational data.

IT [added: and other] systems (ours, as well as those of our franchisees, acquired businesses, and third-party service providers) [removed: are] [added: have been and will continue in the future to be] susceptible to damage, disruptions and shutdowns due to programming errors, defects or other vulnerabilities, power outages, hardware failures, [added: misconfigurations,] computer viruses, cyber-attacks, [added: encryption caused by] ransomware or malware attacks, [added: exfiltration of data,] attacks by foreign [removed: governments and] [added: governments,] state-sponsored actors, [added: or criminal groups,] theft, misconduct by employees or other insiders, telecommunications failures, misuse, human errors or other catastrophic events.

[removed: In addition,] [added: However, cybersecurity incidents have in] the [removed: occurrence of any of these events could] [added: past and may in the future] expose us, our customers, franchisees, service providers or others, to [removed: a risk of] loss, disclosure or misuse of proprietary information and sensitive or confidential [removed: data, including personally identifiable information.][added: data or result in disruptions to our operations or those of our customers, franchisees, service providers or others.]

In recent periods, the frequency and sophistication of cyber-attacks [removed: has increased,] [added: have increased and are expected to continue to increase,] including as a result of state-sponsored cybersecurity attacks during periods of geopolitical conflict, such as the ongoing [removed: conflict] [added: conflicts] in [removed: Ukraine.][added: Ukraine and the Middle East.]

Accordingly, we may be unable to anticipate these techniques or to implement adequate measures to recognize, detect or prevent the occurrence of any of the events described [removed: above.]

We [removed: also depend on] [added: utilize] and interact with the IT networks and systems of [removed: third-parties] [added: third parties] for many aspects of our [removed: operations,] [added: business,] including [added: related to] our customers, franchisees and service providers such as cloud service providers and third-party delivery services.

These third parties [removed: may] have access to information we maintain about our company, operations, customers, employees and vendors, or operating systems that are critical to or can significantly impact our business operations.

These third parties are subject to risks [removed: resulting from data breaches, cyberattacks, IT systems disruptions,] [added: described above,] and other [removed: events or actions described above] [added: risks,] that could damage, disrupt or close down their networks or systems.

New technologies may also create additional sources of competition.

In addition, we strive to lower our cost to serve, including labor costs, through various strategic initiatives.

In the third quarter of 2023, a new national master agreement with the Teamsters, which runs through July 31, 2028, was ratified.

Other employees may choose to organize in the future.

We maintain significant physical operations.

In addition, the rapid evolution and increased adoption of artificial intelligence technologies may intensify our cybersecurity risks.

above.

In addition, our security processes, protocols and standards may not prove to be sufficient, effective or may not be complied with, either intentionally or inadvertently.

To date, we have not experienced a material cybersecurity incident.

For example, cyber criminals have in the past gained access, and are expected to continue to try to gain access to customer accounts.

The type of activity includes fraudulently diverting and misappropriating items being transported in our network, fraudulently charging shipment fees to customer or franchisee accounts, and fraudulently sending text messages to recipients purporting to be from UPS.

In addition, there has recently been heightened regulatory and enforcement focus relating to the collection, use, retention, transfer, and processing of personal data in the U.S. (at both the state and federal level) and internationally, including the EU’s General Data Protection Regulation, the California Privacy Rights Act, the Virginia Consumer Data Protection Act, and other similar laws that have been or are expected to be enacted by other jurisdictions.

In addition, China and certain other jurisdictions have enacted more stringent data localization requirements.

An actual or alleged failure to comply with applicable data protection laws, regulations, or other data protection standards has in the past and may in the future expose us to litigation, fines, sanctions, or other penalties, which could harm our reputation and adversely affect our business, results of operations, and financial condition.

The regulatory environment is increasingly challenging, based on discretionary factors, and difficult to predict.

Consequently, compliance with applicable regulations in the various jurisdictions in which we do business may present material obligations and risks to our business, including significantly expanded compliance burdens, costs, and enforcement risks which are expected to increase over time; require us to make extensive system or operational changes; or adversely affect the cost or attractiveness of the services we offer.

The proliferation of social media may increase the likelihood, speed, and magnitude of negative brand events.

Furthermore, climate change may reduce the availability or increase the cost of insurance for these negative impacts of natural disasters and adverse weather conditions by contributing to an increase in the incidence and severity of such natural disasters.

If the carrying value of an asset exceeds its estimated fair value, we may be required to incur charges to reduce the carrying value thereof.

For example, during the year ended December 31, 2023, as a result of a number of factors including changes in business strategy and challenging macroeconomic conditions such as increases in the risk-free interest rate and volatility of the stock prices of market comparables, we incurred impairment charges of $125 and $111 million in respect of goodwill and indefinite-lived intangible assets, respectively.

Furthermore, many countries, as well as U.S. states, in which we operate or are subject to regulation have adopted, or are expected to adopt, additional requirements relating to the disclosure of GHG emissions and related matters.

In many cases these requirements differ and may conflict from country to country.

Compliance with these disclosure requirements may increase our operating costs or require significant management time and attention.

Any failure to comply with applicable disclosure regulations in the U.S. (at either the federal or state level) or other countries could result in substantial fines or other penalties, which could materially adversely affect us.

The consequences of the COVID-19 pandemic have had, and may continue to have, a significant impact on us, as well as on the operations of many of our customers.

The consequences of the COVID-19 pandemic have had a substantial impact on business and consumer activity, including contributing to a curtailment of certain business activities (including a decrease in demand for a broad variety of goods and services), significant ongoing supply chain disruptions, economic uncertainty and volatility in global financial markets.

These consequences have significantly impacted, and may continue to significantly impact us, and have had, and may continue to have, a material adverse impact on the operations, financial performance and liquidity of many of our customers.

Because of ongoing uncertainty with respect to the consequences of the COVID-19 pandemic, the future impact on our operations, financial condition and liquidity also remains uncertain and difficult to predict.

This impact will continue to depend on evolving factors, many of which are not within our control, and to which we may not be able to effectively respond.

These risks include, but are not limited to: a significant reduction in revenue due to renewed or extended curtailment of business activities; a significant increase in our expenses or a reduction in our operating margins due to long-term changes in the mix of our products and services; effects from governmental, business and individuals’ actions that have been and continue to be taken in response to the pandemic (including workforce pressures); reductions in operating effectiveness due to employees working remotely or in hybrid models; unavailability of personnel; the delay or cancellation of capital projects and related delays in, or loss of, expected benefits therefrom; limited access to liquidity; increased volatility and pricing in the capital markets; further disruption of global supply chains; impairments in the fair value of our assets; increases in pension funding obligations; and reductions in our customers’ credit-worthiness.

Competition may also come from other sources in the future as new technologies are developed.

We maintain a large workforce.

In addition, our strategic initiatives, including transformation, have led and are expected to continue to lead to the creation of fewer, but more impactful, jobs as we strive to lower our cost to serve.

These agreements run through July 31, 2023.

We have begun negotiating the various supplemental agreements with the Teamsters and expect that negotiations with respect to the national master agreement will commence in April 2023.

We are negotiating in good faith in an effort to reach an agreement that is in the best interests of our employees, the Teamsters and UPS; however, no assurances of our ability to do so, or the timing or terms thereof, can be provided.

In addition, our services, and the operation of our networks and systems involve the collection, storage and transmission of significant amounts of proprietary information and sensitive or confidential data, including personal information of customers, employees and others.

We regularly move data across national borders, and are subject to a variety of evolving laws and regulations in the U.S. and abroad regarding privacy, data protection and data security.

The scope of these laws is often uncertain and may be conflicting, particularly with respect to foreign laws.

For example, the E.U.'s General Data Protection Regulation greatly increases the jurisdictional reach of, and potential penalties under, E.U. law, and adds a broad array of requirements for handling personal data, including the public disclosure of significant data breaches.

In addition, China and other countries have also enacted or proposed stringent data localization laws which could significantly increase our costs, require us to make extensive system or operational changes, or adversely affect the value of our services.

These events, which have become more frequent and sophisticated, could, from time to time, cause material service outages, allow inappropriate or block legitimate access to systems or information, or result in other material interruptions in our business.

The techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently.

Hybrid and remote working arrangements may heighten these risks.

Similarly, an actual or alleged failure to comply with increasingly challenging U.S. and foreign data protection regulations or other data protection standards may expose us to litigation, fines, sanctions or other penalties.

We have significant international operations.

A voluntary participation pilot phase began in 2021, and full mandatory participation is scheduled to begin in 2027.

[removed: See] [added: For more information regarding residual values, see] note [removed: 8] [added: 4] to the audited, consolidated financial [removed: statements for additional information on business acquisitions.][added: statements.]

Highlights of our results for the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] which are discussed in more detail in the sections that follow, include:

[removed: | | | | 2022 | | | | | | 2021 | | | | | | $ | | | | | | % | | |][added: *2022 compared to 2021*]

| Revenue (in millions) | | | $ | [removed: 100,338] [added: 90,958] | | | | | $ | [removed: 97,287] [added: 100,338] | | | | | $ | [removed: 3,051] [added: (9,380)] | | | | | [removed: 3.1] [added: (9.3)] | | % |

| Operating Expenses (in millions) | | | [removed: 87,244] [added: 81,817] | | | | | | [removed: 84,477] [added: 87,244] | | | | | | [removed: 2,767] [added: (5,427)] | | | | | | [removed: 3.3] [added: (6.2)] | | % |

| Operating Profit (in millions) | | | $ | [removed: 13,094] [added: 9,141] | | | | | $ | [removed: 12,810] [added: 13,094] | | | | | $ | [removed: 284] [added: (3,953)] | | | | | [removed: 2.2] [added: (30.2)] | | % |

| Operating Margin | | | [removed: 13.0] [added: 10.0] | | % | | | | [removed: 13.2] [added: 13.0] | | % | | | | | | | | | | | | |

| Net Income (in millions) | | | $ | [removed: 11,548] [added: 6,708] | | | | | $ | [removed: 12,890] [added: 11,548] | | | | | $ | [removed: (1,342)] [added: (4,840)] | | | | | [removed: (10.4)] [added: (41.9)] | | % |

| Basic Earnings Per Share | | | $ | [removed: 13.26] [added: 7.81] | | | | | $ | [removed: 14.75] [added: 13.26] | | | | | $ | [removed: (1.49)] [added: (5.45)] | | | | | [removed: (10.1)] [added: (41.1)] | | % |

| Diluted Earnings Per Share | | | $ | [removed: 13.20] [added: 7.80] | | | | | $ | [removed: 14.68] [added: 13.20] | | | | | $ | [removed: (1.48)] [added: (5.40)] | | | | | [removed: (10.1)] [added: (40.9)] | | % |

| Operating Days | | | [removed: 255] [added: 254] | | | | | | [removed: 254] [added: 255] | | | | | | | | | | | | | | |

| Average Daily Package Volume (in thousands) | | | [removed: 24,291] [added: 22,290] | | | | | | [removed: 25,250] [added: 24,291] | | | | | | | | | | | | [removed: (3.8)] [added: (8.2)] | | % |

| Average Revenue Per Piece | | | $ | [removed: 13.38] [added: 13.62] | | | | | $ | [removed: 12.32] [added: 13.38] | | | | | $ | [removed: 1.06] [added: 0.24] | | | | | [removed: 8.6] [added: 1.8] | | % |

- We reported net income of [removed: $11.5] [added: $6.7] billion and diluted earnings per share of [removed: $13.20.][added: $7.80.]

Adjusted diluted earnings per share [removed: was $12.94] [added: were $8.78] after adjusting for the after-tax impacts of:

◦defined benefit pension and postretirement medical benefit plan mark-to-market [removed: gains] [added: loss] outside of a 10% [removed: corridor, together with defined benefit pension plan curtailment gains, totaling $806] [added: corridor of $274] million, or [removed: $0.92] [added: $0.32] per diluted share;

[removed: ◦transformation strategy costs] [added: ◦Transformation Strategy Costs] of [removed: $142] [added: $333] million, or [removed: $0.15] [added: $0.39] per diluted [removed: share.][added: share;]

In Supply Chain Solutions, [removed: the decrease in] revenue [removed: was] [added: decreases for the year were] driven by volume and market rate declines in [removed: Forwarding, as well as the impact of divesting UPS Freight in 2021.][added: Forwarding.]

[removed: Expenses decreased,] [added: On an adjusted basis, operating expenses decreased $295 million] driven by [removed: lower transportation costs in Forwarding and] a reduction [added: of $363 million] in [removed: operating expenses due] [added: costs incurred] to [added: procure transportation for, and provide transition services to,] the [removed: divestiture] [added: acquirer] of UPS Freight.

These [removed: decreases] [added: factors] were partially offset [removed: by higher operating costs in Logistics.][added: by:]

Management's Discussion and Analysis of Financial Condition and Results of Operations* of the Company's Annual Report on Form 10-K for the year ended December 31, [removed: 2021] [added: 2022] filed with the Securities and Exchange Commission on February [removed: 22, 2022.][added: 21, 2023.]

| Non-GAAP Adjustments | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | |

| Incentive Compensation Program Design Changes | | | [removed: $] [added: —] | [removed: 505] | | | | | [removed: $] [added: 505] | [removed: —] | |

| Long-Lived Asset Estimated Residual Value Changes | | | [removed: 76] [added: —] | | | | | | [removed: —] [added: 76] | | |

| Transformation Strategy Costs | | | [removed: 178] [added: 435] | | | | | | [removed: 380] [added: 178] | | |

| Goodwill and Asset Impairment [removed: Charges, and Divestitures] [added: Charges] | | | [removed: —] [added: (43)] | | | | | | [removed: (46)] [added: —] | | |

| Total Adjustments to Operating Expenses | | | $ | [removed: 759] [added: 732] | | | | | $ | [removed: 334] [added: 759] | |

| Defined Benefit Pension and Postretirement Medical Plan (Gains) and Losses | | | $ | [removed: (1,061)] [added: 359] | | | | | $ | [removed: (3,272)] [added: (1,061)] | |

| Total Adjustments to Other Income and (Expense) | | | $ | [removed: (1,061)] [added: 359] | | | | | $ | [removed: (3,272)] [added: (1,061)] | |

| Total Adjustments to Income Before Income Taxes | | | $ | [removed: (302)] [added: 1,091] | | | | | $ | [removed: (2,938)] [added: (302)] | |

| Incentive Compensation Program Design Changes | | | [removed: $] [added: —] | [removed: (121)] | | | | | [removed: $] [added: (121)] | [removed: —] | |

| Long-Lived Asset Estimated Residual Value Changes | | | [removed: (18)] [added: —] | | | | | | [removed: —] [added: (18)] | | |

| Transformation Strategy Costs | | | [removed: (36)] | | | | | | [removed: (95)] | | | [added: | | | | | | | | | | | |]

| Goodwill and Asset Impairment [removed: Charges, and Divestitures] [added: Charges] | | | [removed: —] | | | | | | [removed: 11] | | | [added: | | | | | | | | | | | |]

| Defined Benefit Pension and Postretirement Medical Plan (Gains) and Losses | | | [removed: 255] [added: (85)] | | | | | | [removed: 784] [added: 255] | | |

| Total Adjustments to Income Tax Expense | | | $ | [removed: 80] [added: (245)] | | | | | $ | [removed: 700] [added: 80] | |

| Total Adjustments to Net Income | | | $ | [removed: (222)] [added: 846] | | | | | $ | [removed: (2,238)] [added: (222)] | |

These items have been excluded from the following discussions of "adjusted" [removed: compensation and benefits, operating expenses, operating profit, operating margin, other income and (expense), income tax expense and effective tax rate.][added: results.]

The blended average effective income tax rates for the years ended December 31, [removed: 2022] [added: 2023] and [removed: 2021] [added: 2022] were [removed: 26.5%] [added: 22.5%] and [removed: 23.8%,] [added: 26.5%,] respectively.

We believe excluding the impacts of such changes allows users of our financial statements to [removed: more appropriately] identify underlying growth trends in compensation and benefits expense.

We continue to focus on executing our strategy of *Customer First, People Led and Innovation Driven* by making it quicker and easier for customers to do business with us.

We continue to enhance customer engagement through combining our network with digital capabilities and to invest in the most attractive parts of the market, including healthcare, Asia trade lanes and small- and medium-sized businesses ("SMBs").

In furtherance of our strategy, during 2023 we acquired MNX Global Logistics, a global time-critical and temperature-sensitive logistics provider, and Happy Returns, a technology-focused company that provides innovative end-to-end return services.

We opened our state-of-the-art *UPS Velocity* fulfillment center in the U.S. and announced plans to build a new air hub in Hong Kong.

These initiatives, together with continued growth in our Digital Access Program and deployment of our *Smart Package Smart Facility* technology within U.S. small package operations, are intended to allow us to reach new markets and customers, and better serve our current customer base.

During the year, macroeconomic headwinds, including inflationary pressures and changes in consumer behavior, together with volume diversion resulting from our labor negotiations with the International Brotherhood of Teamsters ("Teamsters"), contributed to volume declines in our U.S. small package business.

Internationally, the challenging macroeconomic environment, coupled with geopolitical tensions, drove a decline in demand for our small package services in Europe and Asia.

Our freight forwarding businesses, including truckload brokerage, were negatively impacted by soft demand and market overcapacity.

We expect global economic conditions to improve gradually during 2024, and therefore expect volume and revenue growth to increase in the second half of the year.

In the third quarter of 2023, our Teamsters employees ratified a new national master agreement.

Under the agreement, wage and benefit rates, combined with all other contract provisions, will increase union cost at a 3.3% compounded annual growth rate over the five-year term of the contract, with the majority of the increase in the first and fifth years.

We experienced higher year-over-year labor costs in the second half of the year as a result of these contractual increases, which we expect to persist through the first half of 2024.

Faced with a challenging external environment, we remain focused on our strategy.

We are taking action intended to right-size our business for the future and focus on key enablers of growth.

These moves include exploring strategic alternatives for our truckload brokerage business and reducing headcount through our "fit to serve" initiative to create a more efficient operating model and enhance responsiveness to changing market dynamics.

| | | | 2023 | | | | | | 2022 | | | | | | $ | | | | | | % | | |

- Revenue and average daily package volume in our global small package operations decreased for the year, with declines in both commercial and residential shipments across all of our products.

These declines were primarily the result of the macroeconomic conditions and union labor-related uncertainties described above, as well as reductions in fuel and demand-related surcharges.

- Operating expenses decreased for the year, driven by a reduction in purchased transportation in Supply Chain Solutions and reductions in fuel expense in our small package operations, as well as the impact of our ongoing productivity initiatives and reductions in operating costs; these reductions were partially offset by U.S. Domestic Package segment wage rate increases in the second half of 2023 due to the new Teamsters contract.

- Operating profit and operating margin decreased, as revenue declines were greater than operating expense reductions.

◦goodwill and asset impairment charges of $193 million, or $0.22 per diluted share; and

◦a one-time compensation payment of $46 million, or $0.05 per diluted share.

In the U.S. Domestic Package segment, revenue declines for the year were driven by lower volume, a shift in product mix, and lower fuel and demand-related surcharges.

These were somewhat offset by revenue per piece growth due to increases in base rates and changes in customer mix.

Expenses decreased for the year, primarily due to declines in fuel prices and reductions in purchased transportation.

Higher direct union labor costs were offset by a reduction in hours and lower management compensation expense.

In our International Package segment, revenue declines for the year were driven by lower volume and declines in fuel and demand-related surcharges.

These were partially offset by the impact of base rate increases.

Expenses decreased year over year, driven by lower fuel and third-party transportation expense as a result of volume declines and lower fuel prices.

Expenses decreased for the year, primarily due to a reduction in purchased transportation in Forwarding.

| One-Time Compensation Payment | | | $ | 61 | | | | | $ | — | |

| One-Time Compensation Payment | | | $ | (15) | | | | | $ | — | |

*One-Time Compensation Payment*

During 2023, we made a one-time payment to certain U.S.-based, non-union part-time supervisors following the ratification of our labor agreement with the Teamsters.

We do not expect this or similar payments to recur.

We supplement the presentation of our operating profit, operating margin, income before income taxes, net income and earnings per share with non-GAAP measures that exclude the impact of this payment.

We believe excluding the impact of this one-time payment better enables users of our financial statements to view and evaluate underlying business performance from the same perspective as management.

2023 - $0.4 billion pre-tax defined benefit plan loss:

- *Discount Rates* ($384 million pre-tax loss): The weighted-average discount rate for our pension and postretirement medical plans decreased from 5.77% as of December 31, 2022 to 5.40% as of December 31, 2023, primarily due to a decrease in credit spreads on AA-rated corporate bonds in 2023.

- *Demographic and Other Assumption Changes* ($4 million pre-tax loss): This loss was due to differences between actual and estimated participant data and demographic factors, including healthcare cost trends, compensation rate increases and rates of termination, retirement and mortality.

We continue to execute our *Customer First, People Led, Innovation Driven* strategy, focusing on the parts of our market that value our integrated global network and building capabilities that matter to our customers.

We are shifting our strategic framework to *Better and Bolder* by seeking to enhance customer engagement through combining our network with digital capabilities to drive new services, while at the same time increasing efficiencies and remaining disciplined with capital allocation.

A number of macroeconomic factors contributed to a challenging operating environment in 2022, including global inflation and rising interest rates, recessionary forecasts, wage and labor market pressures, geopolitical uncertainties and foreign currency exchange rates relative to the United States ("U.S.") Dollar.

We continued to be affected by COVID-19 lockdowns in China that impacted both manufacturing and supply chains.

In addition, consumers returned to more pre-pandemic shopping patterns.

These factors resulted in disruptions to certain parts of our business, negatively impacted demand for our services and contributed to increases in certain of our operating costs.

We anticipate these factors will continue to impact us into 2023.

We expect we may experience additional uncertainty related to the upcoming renegotiation of certain of our union labor agreements.

Despite the challenging macroeconomic environment, our strategic execution strengthened our balance sheet and resulted in the generation of strong cash flows for the year.

We retired $2.0 billion of debt, reinvested in the business and returned cash to shareowners through dividends and share repurchases.

We also completed the acquisition of Delivery Solutions, a digital platform that optimizes customer deliveries across multiple networks, and the acquisition of Bomi Group, which will accelerate our growth in healthcare logistics by expanding our footprint and bringing additional expertise in cold chain logistics.

Neither acquisition had a material impact on our results of operations for the year.

| | | | | | | | | | | | | | | | | | | | | | | | |

- Average daily package volume in our global small package operations decreased, primarily due to lower levels of business-to-consumer shipping.

- Revenue increased due to strong revenue per piece growth, with most of the increase in our U.S. Domestic Package segment.

Revenue in Supply Chain Solutions decreased.

- Operating expenses increased, driven by higher fuel prices and higher compensation and benefits expense, primarily in our U.S. Domestic Package segment.

- Operating profit and operating margin increased, with the increases coming from the U.S. Domestic Package segment and Supply Chain Solutions, while operating profit and operating margin declined in the International Package segment.

◦a one-time, non-cash charge related to the accelerated vesting of certain equity awards in connection with an incentive compensation program design change of $384 million, or $0.44 per diluted share;

◦a one-time, non-cash charge in connection with a reduction in the estimated residual value of our MD-11 aircraft of $58 million, or $0.07 per diluted share; and

In the U.S. Domestic Package segment, revenue growth resulted from higher fuel revenue, driven by increases in both price per gallon and in fuel surcharge rates as part of our pricing initiatives, as well as improvements in revenue quality and customer mix.

Expenses increased due to higher fuel prices and higher compensation and benefits costs, which were partially offset by declines in purchased transportation costs and higher productivity as we executed our strategy.

In our International Package segment, revenue increased slightly, driven by fuel revenue, revenue quality actions and favorable shifts in customer and product mix.

These increases were mostly offset by lower volume, the impact of the strengthening U.S. Dollar and reductions in demand-related surcharges, primarily in the fourth quarter.

Expense increases were primarily driven by higher fuel prices, partially offset by favorable currency impacts and volume declines.

These decreases were partially offset by growth in our healthcare operations and in a number of our other businesses.

*2021 compared to 2020*

| | | | | | | | | | | | |

For information regarding residual values, see note 4 to the audited, consolidated financial statements.

| Coordinating benefits attributable to the Central States Pension Fund | | | | | | — | | | | | | 1,767 | | |

2021 - $3.3 billion pre-tax defined benefit plan gain, primarily due to the impact of the interim remeasurement of the UPS/IBT Plan in the first quarter of 2021 as described in note 5 to the audited, consolidated financial statements:

*•Discount Rates* ($1.9 billion pre-tax gain): This gain was largely attributable to an increase in the discount rate for the UPS/IBT Plan from 2.98% as of December 31, 2020 to 3.70% as of March 31, 2021, driven by an increase in U.S. treasury yields in 2021.

- *Coordinating benefits attributable to the Central States Pension Fund* ($1.8 billion pre-tax gain): This represents a reduction of the liability for potential coordinating benefits that may be required to be paid related to the Central States Pension Fund.

| Deferred | | | 1,553 | | | | | | 1,723 | | | | | | | | | | | | (9.9) | | % |

| Ground | | | 17,242 | | | | | | 17,646 | | | | | | | | | | | | (2.3) | | % |

| Deferred | | | 15.07 | | | | | | 13.36 | | | | | | 1.71 | | | | | | 12.8 | | % |

| Ground | | | 10.81 | | | | | | 9.92 | | | | | | 0.89 | | | | | | 9.0 | | % |

| Deferred | | | 5,968 | | | | | | 5,846 | | | | | | 122 | | | | | | 2.1 | | % |

| Ground | | | 47,542 | | | | | | 44,462 | | | | | | 3,080 | | | | | | 6.9 | | % |

| Total Revenue | | | $ | 64,209 | | | | | $ | 60,317 | | | | | $ | 3,892 | | | | | 6.5 | | % |

As of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] we had no commodity contracts outstanding.

These derivative instruments generally cover forecasted foreign currency exposures for periods of [removed: 12] [added: 3] to [removed: 48] [added: 36] months.

We [added: may] use interest rate swaps as part of our program to manage the fixed and floating interest rate mix of our total debt portfolio and related overall cost of borrowing.

[removed: Our floating-rate debt and interest rate swaps] [added: These instruments] subject us to risk resulting from changes in short-term interest rates.

We are also subject to interest rate risk with respect to our defined benefit pension and postretirement medical [added: benefit] plan obligations, as changes in interest rates will effectively increase or decrease the obligations associated with these plans.

| | | | Shock-Test Result as [removed: of December] [added: of December] 31, | | | | | | | | |

| (in millions) | | | [removed: 2022] [added: 2023] | | | | | | [removed: 2021] [added: 2022] | | |

| Currency Derivatives(1) | | | $ | [removed: (770)] [added: (649)] | | | | | $ | [removed: (766)] [added: (770)] | |

| Variable Rate Debt(2) | | | $ | [removed: 18] [added: 41] | | | | | $ | [removed: 22] [added: 18] | |

| Marketable Securities(3) | | | $ | 1 | | | | | $ | [removed: —] [added: 1] | |

(2)The potential change in annual interest expense resulting from a hypothetical 100 basis point increase in short-term interest rates, applied to our variable rate [removed: debt and swap instruments (excluding hedges of anticipated debt issuances).][added: debt.]

The sensitivity of our defined benefit pension and postretirement [added: benefit] plan obligations to changes in interest rates is [removed: quantified] [added: discussed] in "Critical Accounting [removed: Estimates".][added: Estimates - Pension and Other Postretirement Medical Benefits".]

| | | | | | | | | | | | |

The notional amount, interest payment and maturity dates of the swaps match the terms of the associated debt.

| Interest Rate Derivatives(2) | | | $ | — | | | | | $ | 10 | |

We deliver packages each business day for approximately 1.6 million shipping customers to [removed: 11.1] [added: 10.2] million delivery recipients in over [removed: 220] [added: 200] countries and territories.

In [removed: 2022,] [added: 2023,] we delivered an average of [removed: 24.3] [added: 22.3] million packages per day, totaling [removed: 6.2] [added: 5.7] billion packages during the year.

Total revenue in [removed: 2022] [added: 2023] was [removed: $100.3] [added: $91.0] billion.

Our well-defined strategy focuses on growing in the parts of our market that value our end-to-end [removed: network, including small- and medium-sized businesses ("SMBs"), healthcare, international and certain large enterprise accounts.][added: network.]

*Customer First* is about [added: anticipating and] solving for the needs of our customers.

We [added: know successful outcomes are built from a strong culture and we] believe that when we take care of our people, they take care of our customers.

We continue to leverage [removed: technology] [added: data] and automation to deliver improvements to our network and unlock [added: additional] value for our customers through innovation.

[removed: *Global Smart Logistics Network.*] We believe that our integrated global air and ground network is the most extensive in the industry.

[removed: *Global Presence.*] We serve more than [removed: 220] [added: 200] countries and territories.

[removed: *Cutting-Edge Technologies.*] We are a global leader in developing technologies that help [removed: our] customers enhance their shipping and logistics business processes to lower costs, improve service and increase efficiency.

We offer a variety of digital tools [added: and capabilities] that enable [removed: our] customers to integrate UPS functionality into their distribution channels, deepening [removed: our] customer relationships.

These tools allow [removed: our] customers to send, manage and track their shipments, and also provide their customers with value-added data.

[removed: *Broad Portfolio of Services.*] Our [added: service] portfolio [removed: of services] allows customers to choose their most appropriate delivery option.

For example, [added: our] supply chain services [removed: – such as global freight forwarding, truckload brokerage, customs brokerage, order fulfillment and returns management –] are designed to [removed: help] improve the efficiency and resilience of [removed: our] customers’ entire supply chain management process.

[removed: *Customer Relationships.*] We focus on building and maintaining long-term customer relationships.

Value-added services beyond package delivery, and connecting our small package, supply chain and digital services across our customer base, are important to [removed: our] customer retention and growth.

[removed: *Brand Equity.*] We have built a leading and trusted brand that stands for [added: service] quality, reliability and [removed: service] [added: product] innovation.

[removed: *Distinctive Culture.*] We believe that the dedication of our employees comes in large part from our [removed: purpose driven] [added: purpose-driven] culture that fosters trust, [removed: appreciation] [added: partnership] and empowerment.

We [removed: value the contribution of all of] [added: encourage] our [removed: people, encouraging everyone] [added: people] to bring their unique [removed: perspective,] [added: perspectives,] background, talents and skills to work every day.

[removed: *Financial Strength.* Our financial strength allows us to continue] [added: This includes] investing in digital technology, [added: acquisitions,] transportation equipment, facilities and employee development to generate value for shareholders.

We [removed: pursue strategic opportunities that facilitate our growth and] seek to maintain a strong credit rating to give us [added: additional] flexibility in running the business.

These [removed: include] [added: services are supported by numerous shipping, visibility and billing technologies including] our Digital Access Program, which embeds our shipping solutions directly into leading e-commerce platforms, enabling us to more broadly reach [removed: SMB customers] [added: small-] and [added: medium-sized businesses and] e-commerce markets.

All of our services [removed: (air, ground, domestic, international, commercial and residential)] are managed through a single, global smart logistics network.

Our global smart logistics network offers approximately [removed: 197,000] [added: 180,000] entry points where customers can tender packages to us at locations and times convenient to them.

We offer a full spectrum of U.S. domestic [removed: guaranteed] air and ground package transportation services.

- Our air portfolio offers time-definite, [removed: same day, next day, two day] [added: same-day, next-day, two-day] and [removed: three day] [added: three-day] delivery alternatives.

- Our ground network enables customers to ship using our day-definite [removed: guaranteed] ground service.

We deliver [removed: more than 17] [added: approximately 16] million ground packages per day, most within one to three business days.

International Package consists of our small package operations in Europe, [removed: Asia,] the Indian sub-continent, [removed: the] Middle [removed: East, Africa,] [added: East and Africa (together "EMEA"),] Canada and Latin [removed: America.][added: America (together "Americas") and Asia.]

Supply Chain Solutions consists of our forwarding, [removed: truckload brokerage, logistics and distribution] [added: logistics, digital] and other businesses.

We are one of the largest U.S. domestic airfreight carriers and [removed: among the top] airfreight forwarders globally.

Additionally, as one of the world’s leading non-vessel operating common carriers, we provide ocean freight [removed: full-container] [added: full container] load, less-than-container load and multimodal transportation services between most major ports around the world.

Access to the UPS fleet, combined with a broad third-party carrier network, [removed: creates customized] [added: enables us to create] capacity solutions for [added: customers of] all [removed: markets] [added: sizes across industries, delivered through a combination of people] and [removed: customers.][added: technology.]

[removed: Coyote customers] [added: Customers] can also access UPS services such as airfreight, customs brokerage and global freight forwarding.

[removed: *Logistics & Distribution*][added: *Logistics*]

We operate both multi-client and dedicated facilities across our network, many of which are strategically located near UPS air and ground transportation hubs to support rapid delivery to [removed: consumer and] business [added: and consumer] markets.

We offer world-class technology, deep expertise and a highly sophisticated suite of [added: healthcare logistics] services.

With a strategic focus on serving the unique, priority-handling needs of healthcare and life sciences customers, we continue to increase our [added: complex] cold-chain logistics capabilities both in the U.S. and internationally.

[removed: *Other] [added: *Digital and other] Supply Chain Solutions businesses*

We also offer integrated supply chain and high-value shipment insurance solutions to both small and large businesses through UPS [removed: Capital.][added: Capital, as well as a range of services through our other Supply Chain Solutions businesses.]

*Global Smart Logistics Network*.

Our sophisticated systems, including our RFID-enabled Smart Package, Smart Facility technology, allow us to optimize network efficiency and asset utilization, and enhance end-to-end shipment visibility.

*Global Presence*.

*Cutting-Edge Technologies*.

*Broad Portfolio of Services*.

*Customer Relationships*.

*Brand Equity*.

*Distinctive Culture*.

*Financial Strength*.

Our financial strength allows us to continue to pursue strategic opportunities that facilitate our growth.

To accelerate growth of this portfolio, in the fourth quarter of 2023 we acquired Happy Returns, a technology-focused company that is managed and reported within Supply Chain Solutions, to provide innovative end-to-end return services and a consolidated returns solution for our enterprise retail customers.

Serving more than 200 countries and territories, we strategically seek to provide integration across increasingly complex, specialized and fragmented supply chains.

We provide brokerage services that coordinate a fleet of less-than-truckload and truckload vehicles for shipments requiring ground freight transportation in North America and Europe.

In furtherance of this strategy and to broaden our reach and services, we recently acquired Bomi Group and MNX Global Logistics.

Our digital businesses leverage technology to enable a range of on-demand services.

Roadie offers customers the convenience of same-day delivery, while Happy Returns offers innovative end-to-end return services that leverage The UPS Store network.

In the third quarter of 2023, the Teamsters fully ratified a new national master agreement that expires July 31, 2028.

Our agreement with the IPA becomes amendable September 1, 2025.

We believe leveraging diverse perspectives and creating inclusive environments improves our organizational effectiveness, cultivates innovation, and drives growth.

UPS's Comprehensive Health and Safety Program ("CHSP") is an occupational health and safety system tailored to our varied operational environments.

Our CHSP covers a wide array of roles, from package handling to administration, and spans geographical boundaries to include sorting facilities, mobile logistics, administrative offices, and other locations worldwide.

UPS conducts audits to assess specific risks and hazards, including equipment safety, workplace environment, and emergency response protocols.

For additional information, see "Risk Factors – Business and Operating Risks – We maintain significant physical operations.

We are subject to a variety of evolving laws and regulations in the U.S. and abroad regarding privacy, cybersecurity, data protection and data security, including the European Union General Data Protection Regulation and China's Personal Information Protection Law.

Disclosures Required Pursuant to Section 13(r) of the Securities Exchange Act of 1934

We maintain robust economic sanctions compliance procedures designed to promote compliance with applicable sanctions laws.

However, it is possible that from time to time we may inadvertently pick up packages from, or deliver packages to, individuals or entities that result in required disclosure under Section 13(r).

As a component of our compliance procedures, from time to time we undertake additional reviews of historical transactions.

Based on our most recent review, from August 2018 to the date of this filing, in addition to previously disclosed deliveries we inadvertently delivered to: Bank Melli – 2 shipments (revenue of $18.84, loss of $3.98); the Embassy of Iran (revenue of $7.81, loss of $0.65); Syrian Airlines (revenue of $7.70, profit of $0.72); Irasco SRL – 2 shipments (revenue of $11.59, loss of $1.08); Stark 1 (revenue of $7.33, profit of $2.02); Fanreach (revenue of $9.74, profit of $2.76); and Wael Bazzi (revenue of $4.74, loss of $2.29).

The information provided pursuant to Section 13(r) of the Exchange Act in Item 5 of Part II of the Company's [Quarterly Report on](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000038/0001090727-23-000038-index.htm) [Form 10-Q](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000038/0001090727-23-000038-index.htm) for the quarter ended June 30, 2023 is incorporated by reference herein.

We do not intend to further pick up from or deliver to these parties, and we intend to continue to implement process improvements designed to better identify and prevent potential shipments to or from restricted parties.

We know successful outcomes are built from a strong culture, so we are striving to make UPS a great place to work.

Our sophisticated engineering systems allow us to optimize network efficiency and asset utilization.

These services are supported by numerous shipping, visibility and billing technologies.

We also offer a selection of returns technologies, such as UPS Returns Manager, that promote systems integration, increase customer ease of use and visibility of inbound merchandise.

These technologies help reduce costs and improve efficiency in our customers' reverse logistics processes.

International markets are one of our identified growth opportunities.

Europe is our largest region outside of the U.S. by both revenue and package volume.

We continue to make major European infrastructure investments to meet demand for our services and to improve transit times across the region.

We have recently expanded hubs and gateways in France, Germany and Italy to increase efficiency for cross-border ground shipments and provide capacity for future growth.

We serve more than 40 countries and territories in Asia through alliances with local delivery companies and our owned operations.

Supply chain complexity creates demand for a global service offering that incorporates transportation, distribution and international trade and brokerage services, with complementary financial and information services.

Many companies see value in outsourcing certain logistics activity.

With increased competition and growth opportunities in new markets, businesses require flexible and responsive supply chains to support their strategies.

We aim to meet this demand by offering a broad array of supply chain services in more than 200 countries and territories.

*Truckload Brokerage*

We provide truckload brokerage services in North America and Europe through our Coyote-branded subsidiaries.

Healthcare logistics is one of our targeted growth areas.

During 2022, we acquired Bomi Group to accelerate our growth by expanding our international presence and increasing our cold chain capabilities in major European and Latin American markets.

With the addition of Bomi Group, our network provides customers access to specialized healthcare distribution space in more than 30 countries and territories.

Our other Supply Chain Solutions businesses provide a broad portfolio of services to meet customer needs.

Technology-driven solutions, such as our Roadie same-day delivery business, provide flexibility and visibility for our customers.

During 2022, we extended our contract with the IPA for an additional two years beginning at the end of the current contract on September 1, 2023.

By leveraging diversity with respect to gender, age, ethnicity, skills and other factors, and creating inclusive environments, we believe we can improve organizational effectiveness, cultivate innovation and drive growth.

*Transformation*

As we expand and enter new markets, and seek to capture new opportunities and pursue growth, we need employees to grow and innovate along with us.

We are investing in capabilities that we believe will transform our business, including investments in employee opportunities to support growth.

We provide training for management employees on professionalism and performance, as well as unconscious bias and diversity and inclusion, to seek to ensure our actions align with our values.

We develop a culture of health and safety by:

- investing in safety training and audits;

- promoting wellness practices which mitigate risk; and

- offering benefits designed to keep employees safe in the workplace and beyond.

Our local health and safety committees coach employees on UPS’s safety processes and are able to share best practices across work groups.

Our safety methods and procedures are increasingly focused on the variables associated with residential delivery environments, which have become more common with the growth in e-commerce.

We are also subject to similar regulation, such as the European Union General Data Protection Regulation, internationally.

We have a written Code of Business Conduct that applies to all of our directors, officers and employees, including our principal executive and financial officers.

It is available under the heading "ESG" on the Governance Documents page of our investor relations website.

For the fiscal year ended December 31, [removed: 2022][added: 2023]

[removed: ][added: ]

[added: |] 55 Glenlake Parkway, [removed: N.E.] [added: N.E] Atlanta, [removed: Georgia 30328][added: Georgia | | | | | | 30328 | | |]

[added: |] (Address of Principal Executive [removed: Offices) (Zip] [added: Offices) | | | | | | (Zip] Code) [added: | | |]

| Class B common stock, par value [removed: $.01] [added: $0.01] per share | | | UPS | | | New York Stock Exchange | | |

Class A common stock, par value [removed: $.01] [added: $0.01] per share

The aggregate market value of the class B common stock held by non-affiliates of the registrant was [removed: $133,554,051,887] [added: $129,730,366,499] as of June 30, [removed: 2022.][added: 2023.]

As of February [removed: 3, 2023,] [added: 2, 2024,] there were [removed: 133,935,649] [added: 125,836,384] outstanding shares of class A common stock and [removed: 724,805,339] [added: 726,816,677] outstanding shares of class B common stock.

Portions of the registrant’s definitive proxy statement for its annual meeting of shareowners scheduled for May [removed: 4, 2023] [added: 2, 2024] are incorporated by reference into Part III of this report.

| Item 1. | | | [removed: [Business](#i35a1adf6fb7e41098f62c3e95f9f5045_13)] [added: [Business](#ifcfd3c808065412fa89687f089fe8843_13)] | | | [removed: [1](#i35a1adf6fb7e41098f62c3e95f9f5045_13)] [added: [1](#ifcfd3c808065412fa89687f089fe8843_13)] | | |

| | | | [Competitive [removed: Strengths](#i35a1adf6fb7e41098f62c3e95f9f5045_22)] [added: Strengths](#ifcfd3c808065412fa89687f089fe8843_22)] | | | [removed: [2](#i35a1adf6fb7e41098f62c3e95f9f5045_22)] [added: [2](#ifcfd3c808065412fa89687f089fe8843_22)] | | |

| | | | [Products and Services; Reporting [removed: Segments](#i35a1adf6fb7e41098f62c3e95f9f5045_25)] [added: Segments](#ifcfd3c808065412fa89687f089fe8843_25)] | | | [removed: [2](#i35a1adf6fb7e41098f62c3e95f9f5045_25)] [added: [2](#ifcfd3c808065412fa89687f089fe8843_25)] | | |

| | | | [Human [removed: Capital](#i35a1adf6fb7e41098f62c3e95f9f5045_28)] [added: Capital](#ifcfd3c808065412fa89687f089fe8843_28)] | | | [removed: [5](#i35a1adf6fb7e41098f62c3e95f9f5045_28)] [added: [5](#ifcfd3c808065412fa89687f089fe8843_28)] | | |

| | | | [Government [removed: Regulation](#i35a1adf6fb7e41098f62c3e95f9f5045_37)] [added: Regulation](#ifcfd3c808065412fa89687f089fe8843_37)] | | | [removed: [6](#i35a1adf6fb7e41098f62c3e95f9f5045_37)] [added: [6](#ifcfd3c808065412fa89687f089fe8843_37)] | | |

| | | | [Where You Can Find More [removed: Information](#i35a1adf6fb7e41098f62c3e95f9f5045_40)] [added: Information](#ifcfd3c808065412fa89687f089fe8843_40)] | | | [removed: [8](#i35a1adf6fb7e41098f62c3e95f9f5045_40)] [added: [8](#ifcfd3c808065412fa89687f089fe8843_40)] | | |

| Item 1A. | | | [Risk [removed: Factors](#i35a1adf6fb7e41098f62c3e95f9f5045_43)] [added: Factors](#ifcfd3c808065412fa89687f089fe8843_43)] | | | [removed: [9](#i35a1adf6fb7e41098f62c3e95f9f5045_43)] [added: [10](#ifcfd3c808065412fa89687f089fe8843_43)] | | |

| Item 1B. | | | [Unresolved Staff [removed: Comments](#i35a1adf6fb7e41098f62c3e95f9f5045_46)] [added: Comments](#ifcfd3c808065412fa89687f089fe8843_46)] | | | [removed: [17](#i35a1adf6fb7e41098f62c3e95f9f5045_46)] [added: [17](#ifcfd3c808065412fa89687f089fe8843_46)] | | |

| Item 2. | | | [removed: [Properties](#i35a1adf6fb7e41098f62c3e95f9f5045_49)] [added: [Properties](#ifcfd3c808065412fa89687f089fe8843_49)] | | | [removed: [17](#i35a1adf6fb7e41098f62c3e95f9f5045_49)] [added: [18](#ifcfd3c808065412fa89687f089fe8843_49)] | | |

| | | | [Operating [removed: Facilities](#i35a1adf6fb7e41098f62c3e95f9f5045_52)] [added: Facilities](#ifcfd3c808065412fa89687f089fe8843_52)] | | | [removed: [17](#i35a1adf6fb7e41098f62c3e95f9f5045_52)] [added: [18](#ifcfd3c808065412fa89687f089fe8843_52)] | | |

| Item 3. | | | [Legal [removed: Proceedings](#i35a1adf6fb7e41098f62c3e95f9f5045_58)] [added: Proceedings](#ifcfd3c808065412fa89687f089fe8843_58)] | | | [removed: [18](#i35a1adf6fb7e41098f62c3e95f9f5045_58)] [added: [19](#ifcfd3c808065412fa89687f089fe8843_58)] | | |

| Item 4. | | | [Mine Safety [removed: Disclosures](#i35a1adf6fb7e41098f62c3e95f9f5045_61)] [added: Disclosures](#ifcfd3c808065412fa89687f089fe8843_61)] | | | [removed: [18](#i35a1adf6fb7e41098f62c3e95f9f5045_61)] [added: [19](#ifcfd3c808065412fa89687f089fe8843_61)] | | |

| Item 5. | | | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#i35a1adf6fb7e41098f62c3e95f9f5045_67)] [added: Securities](#ifcfd3c808065412fa89687f089fe8843_67)] | | | [removed: [19](#i35a1adf6fb7e41098f62c3e95f9f5045_67)] [added: [20](#ifcfd3c808065412fa89687f089fe8843_67)] | | |

| | | | [Shareowner Return Performance [removed: Graph](#i35a1adf6fb7e41098f62c3e95f9f5045_70)] [added: Graph](#ifcfd3c808065412fa89687f089fe8843_70)] | | | [removed: [20](#i35a1adf6fb7e41098f62c3e95f9f5045_70)] [added: [21](#ifcfd3c808065412fa89687f089fe8843_70)] | | |

| Item 6. | | | [removed: [\[Reserved\]](#i35a1adf6fb7e41098f62c3e95f9f5045_73)] [added: [\[Reserved\]](#ifcfd3c808065412fa89687f089fe8843_73)] | | | [removed: [21](#i35a1adf6fb7e41098f62c3e95f9f5045_73)] [added: [22](#ifcfd3c808065412fa89687f089fe8843_73)] | | |

| Item 7. | | | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#i35a1adf6fb7e41098f62c3e95f9f5045_76)] [added: Operations](#ifcfd3c808065412fa89687f089fe8843_76)] | | | [removed: [22](#i35a1adf6fb7e41098f62c3e95f9f5045_76)] [added: [23](#ifcfd3c808065412fa89687f089fe8843_76)] | | |

| | | | [Supplemental Information - Items Affecting [removed: Comparability](#i35a1adf6fb7e41098f62c3e95f9f5045_82)] [added: Comparability](#ifcfd3c808065412fa89687f089fe8843_82)] | | | [removed: [24](#i35a1adf6fb7e41098f62c3e95f9f5045_82)] [added: [25](#ifcfd3c808065412fa89687f089fe8843_82)] | | |

| | | | [U.S. Domestic Package [removed: Operations](#i35a1adf6fb7e41098f62c3e95f9f5045_85)] [added: Operations](#ifcfd3c808065412fa89687f089fe8843_85)] | | | [removed: [28](#i35a1adf6fb7e41098f62c3e95f9f5045_85)] [added: [29](#ifcfd3c808065412fa89687f089fe8843_85)] | | |

| | | | [International Package [removed: Operations](#i35a1adf6fb7e41098f62c3e95f9f5045_88)] [added: Operations](#ifcfd3c808065412fa89687f089fe8843_88)] | | | [removed: [31](#i35a1adf6fb7e41098f62c3e95f9f5045_88)] [added: [32](#ifcfd3c808065412fa89687f089fe8843_88)] | | |

| | | | [Supply Chain Solutions [removed: Operations](#i35a1adf6fb7e41098f62c3e95f9f5045_91)] [added: Operations](#ifcfd3c808065412fa89687f089fe8843_91)] | | | [removed: [34](#i35a1adf6fb7e41098f62c3e95f9f5045_91)] [added: [35](#ifcfd3c808065412fa89687f089fe8843_91)] | | |

| | | | [Consolidated Operating [removed: Expenses](#i35a1adf6fb7e41098f62c3e95f9f5045_94)] [added: Expenses](#ifcfd3c808065412fa89687f089fe8843_94)] | | | [removed: [37](#i35a1adf6fb7e41098f62c3e95f9f5045_94)] [added: [38](#ifcfd3c808065412fa89687f089fe8843_94)] | | |

| | | | [Other Income and [removed: (Expense)](#i35a1adf6fb7e41098f62c3e95f9f5045_97)] [added: (Expense)](#ifcfd3c808065412fa89687f089fe8843_97)] | | | [removed: [40](#i35a1adf6fb7e41098f62c3e95f9f5045_97)] [added: [41](#ifcfd3c808065412fa89687f089fe8843_97)] | | |

| | | | [Income Tax [removed: Expense](#i35a1adf6fb7e41098f62c3e95f9f5045_100)] [added: Expense](#ifcfd3c808065412fa89687f089fe8843_100)] | | | [removed: [41](#i35a1adf6fb7e41098f62c3e95f9f5045_100)] [added: [42](#ifcfd3c808065412fa89687f089fe8843_100)] | | |

| | | | [Liquidity and Capital [removed: Resources](#i35a1adf6fb7e41098f62c3e95f9f5045_103)] [added: Resources](#ifcfd3c808065412fa89687f089fe8843_103)] | | | [removed: [42](#i35a1adf6fb7e41098f62c3e95f9f5045_103)] [added: [43](#ifcfd3c808065412fa89687f089fe8843_103)] | | |

| | | | [Collective Bargaining [removed: Agreements](#i35a1adf6fb7e41098f62c3e95f9f5045_106)] [added: Agreements](#ifcfd3c808065412fa89687f089fe8843_106)] | | | [removed: [48](#i35a1adf6fb7e41098f62c3e95f9f5045_106)] [added: [50](#ifcfd3c808065412fa89687f089fe8843_106)] | | |

| | | | [New Accounting [removed: Pronouncements](#i35a1adf6fb7e41098f62c3e95f9f5045_109)] [added: Pronouncements](#ifcfd3c808065412fa89687f089fe8843_109)] | | | [removed: [48](#i35a1adf6fb7e41098f62c3e95f9f5045_109)] [added: [50](#ifcfd3c808065412fa89687f089fe8843_109)] | | |

| | | | [Critical Accounting [removed: Estimates](#i35a1adf6fb7e41098f62c3e95f9f5045_115)] [added: Estimates](#ifcfd3c808065412fa89687f089fe8843_112)] | | | [removed: [49](#i35a1adf6fb7e41098f62c3e95f9f5045_115)] [added: [51](#ifcfd3c808065412fa89687f089fe8843_112)] | | |

| Item 7A. | | | [Quantitative and Qualitative Disclosures about Market [removed: Risk](#i35a1adf6fb7e41098f62c3e95f9f5045_118)] [added: Risk](#ifcfd3c808065412fa89687f089fe8843_115)] | | | [removed: [55](#i35a1adf6fb7e41098f62c3e95f9f5045_118)] [added: [57](#ifcfd3c808065412fa89687f089fe8843_115)] | | |

| Item 8. | | | [Financial Statements and Supplementary [removed: Data](#i35a1adf6fb7e41098f62c3e95f9f5045_121)] [added: Data](#ifcfd3c808065412fa89687f089fe8843_118)] | | | [removed: [57](#i35a1adf6fb7e41098f62c3e95f9f5045_121)] [added: [59](#ifcfd3c808065412fa89687f089fe8843_118)] | | |

| Item 9. | | | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#i35a1adf6fb7e41098f62c3e95f9f5045_205)] [added: Disclosure](#ifcfd3c808065412fa89687f089fe8843_196)] | | | [removed: [127](#i35a1adf6fb7e41098f62c3e95f9f5045_205)] [added: [132](#ifcfd3c808065412fa89687f089fe8843_196)] | | |

| Item 9A. | | | [Controls and [removed: Procedures](#i35a1adf6fb7e41098f62c3e95f9f5045_208)] [added: Procedures](#ifcfd3c808065412fa89687f089fe8843_199)] | | | [removed: [127](#i35a1adf6fb7e41098f62c3e95f9f5045_208)] [added: [132](#ifcfd3c808065412fa89687f089fe8843_199)] | | |

| | | | [Overview](#ifcfd3c808065412fa89687f089fe8843_16) | | | [1](#ifcfd3c808065412fa89687f089fe8843_16) | | |

| | | | [Strategy](#ifcfd3c808065412fa89687f089fe8843_19) | | | [1](#ifcfd3c808065412fa89687f089fe8843_19) | | |

| | | | [Customers](#ifcfd3c808065412fa89687f089fe8843_31) | | | [6](#ifcfd3c808065412fa89687f089fe8843_31) | | |

| | | | [Competition](#ifcfd3c808065412fa89687f089fe8843_34) | | | [6](#ifcfd3c808065412fa89687f089fe8843_34) | | |

| Item 1C. | | | [C](#ifcfd3c808065412fa89687f089fe8843_2030)[ybersecurity](#ifcfd3c808065412fa89687f089fe8843_2030) | | | [17](#ifcfd3c808065412fa89687f089fe8843_2030) | | |

| | | | [Fleet](#ifcfd3c808065412fa89687f089fe8843_55) | | | [19](#ifcfd3c808065412fa89687f089fe8843_55) | | |

| | | | [Overview](#ifcfd3c808065412fa89687f089fe8843_79) | | | [23](#ifcfd3c808065412fa89687f089fe8843_79) | | |

| Item 16. | | | [Form 10-K Summary](#ifcfd3c808065412fa89687f089fe8843_232) | | | [137](#ifcfd3c808065412fa89687f089fe8843_232) | | |

From time to time, we expect to participate in analyst and investor conferences.

Materials provided or displayed at those conferences, such as slides and presentations, may be posted on our investor relations website at *www.investors.ups.com* under the heading "Presentations" when made available.

These presentations may contain new material nonpublic information about our company and you are encouraged to monitor this site for any new posts, as we may use this mechanism as a public announcement.

| | | | | | | | | |

| 0.375% Senior Notes due 2023 | | | UPS23A | | | New York Stock Exchange | | |

| | | | [Overview](#i35a1adf6fb7e41098f62c3e95f9f5045_16) | | | [1](#i35a1adf6fb7e41098f62c3e95f9f5045_16) | | |

| | | | [Strategy](#i35a1adf6fb7e41098f62c3e95f9f5045_19) | | | [1](#i35a1adf6fb7e41098f62c3e95f9f5045_16) | | |

| | | | [Customers](#i35a1adf6fb7e41098f62c3e95f9f5045_31) | | | [6](#i35a1adf6fb7e41098f62c3e95f9f5045_31) | | |

| | | | [Competition](#i35a1adf6fb7e41098f62c3e95f9f5045_34) | | | [6](#i35a1adf6fb7e41098f62c3e95f9f5045_34) | | |

| | | | [Fleet](#i35a1adf6fb7e41098f62c3e95f9f5045_55) | | | [18](#i35a1adf6fb7e41098f62c3e95f9f5045_55) | | |

| | | | [Overview](#i35a1adf6fb7e41098f62c3e95f9f5045_79) | | | [22](#i35a1adf6fb7e41098f62c3e95f9f5045_79) | | |

| Item 16. | | | [Form 10-K Summary](#i35a1adf6fb7e41098f62c3e95f9f5045_241) | | | [132](#i35a1adf6fb7e41098f62c3e95f9f5045_238) | | |

The Board regularly discusses our most significant risks and how these risks are being managed.

The Board has appointed a Risk Committee, consisting entirely of independent directors, whose responsibilities include assisting the Board in overseeing management’s identification and evaluation of strategic enterprise risks, including risks associated with privacy, technology, information security, cybersecurity and cyber incident response and business continuity.

The Risk Committee regularly updates the Board on these activities.

The Risk Committee oversees the Company’s approach to cybersecurity risk assessment and mitigation by, among other things, (i) reviewing the Company’s cybersecurity insurance program, (ii) reviewing the Company’s cybersecurity budget, (iii) discussing the results of various internal cybersecurity audits and periodic independent third-party assessments of the Company’s cybersecurity programs, (iv) being briefed on cybersecurity matters by outside experts, and (v) receiving regular updates from the Company’s Chief Information Security Officer (“CISO”) and others on cybersecurity risks, operational metrics, compliance and regulatory developments, training programs, risk mitigation activities, key projects and industry developments.

The Company's Chief Legal and Compliance Officer ("CLCO"), Chief Digital and Technology Officer ("CDTO"), CISO and Vice President of Compliance and Internal Audit participate in Risk Committee meetings and meet individually with the Risk Committee on a periodic basis to discuss and address relevant matters, including the Company’s approach to cybersecurity risk assessment and mitigation.

The CISO reports to the CDTO, who in turn reports to the Chief Executive Officer ("CEO").

The CISO has more than thirty years of IT experience, has served many years in various information security management roles and has multiple cybersecurity certifications.

The Company maintains an enterprise risk management process designed to identify potential events that may affect the achievement of the Company's objectives or have a material adverse effect on the Company.

Cybersecurity is among the risks considered as a part of this process.

The Company's management, including the CISO, also participates on the Company's Information Security & Privacy Governance Council (“ISPGC”).

The ISPGC meets periodically to consider information security and privacy matters.

The Company utilizes various technical and qualitative processes to assist in identifying, assessing and managing cybersecurity risks.

The Company's processes include periodic discussions and risk reviews with management and, depending on facts and circumstances, may include internal audits, third-party assessments, post-remediation reviews, engagements with independent third-party service providers and key governmental agencies, regular employee training, an incident response plan and backup and recovery plans.

Our periodic engagements with independent third-party service providers are designed to provide qualitative and technical cybersecurity assessments.

The Company has a corporate-level cybersecurity team, led by the CISO, that, among other responsibilities, receives and reviews reports regarding potential threats, trends and remediation strategies.

The cybersecurity team evaluates threat intelligence and information obtained from various sources, including internal, public or private sources, government agencies and external consultants.

Certain of the Company's subsidiaries have separate cybersecurity teams that, along with the corporate-level cybersecurity team, play a role in the Company's efforts to monitor, identify, assess and manage cybersecurity risks.

We interact with the information technology networks and systems of third parties for many aspects of our business.

We consider and evaluate cybersecurity risks associated with the use of independent third-party service providers.

To help UPS understand and mitigate potential cybersecurity risks, we generally utilize measures such as vendor risk assessments, periodic technical assessments of third-party vendors' controls and contracts governing the use of and access to our data and compliance with our security requirements.

We maintain an Incident Response Plan that includes processes and procedures for reviewing and responding to cybersecurity incidents.

We periodically test our readiness to respond to a cybersecurity incident through various scenario-based drills.

The Incident Response Plan includes processes for escalation to the CISO, the Executive Leadership Team, including the CEO, the Risk Committee and the Board, and a process for consideration of whether a cybersecurity incident is material and may require disclosure in SEC filings.

For additional information on cybersecurity risks and the impact they may have on our business strategy, results of operations or financial condition see "Risk Factors – Business and Operating Risks – A significant cybersecurity incident, or increased data protection regulations, could materially adversely affect us".

We own our corporate headquarters in Atlanta, [removed: Georgia, our UPS Supply Chain Solutions headquarters, located in Alpharetta,] Georgia and our information technology headquarters, located in Parsippany, New Jersey.

We own or lease over 1,000 package operating facilities in the U.S., with approximately [removed: 85] [added: 90] million square feet of floor space.

We own or lease approximately 800 facilities [removed: that support] [added: in] our international package operations, with approximately 21 million square feet of floor space.

We own or lease more than 600 facilities, with approximately [removed: 47] [added: 46] million square feet of floor space, which support our freight forwarding and logistics operations.

The following table shows information about our aircraft fleet as of December 31, [removed: 2022:][added: 2023:]

| Description | | | [removed: Owned & Finance Leases] [added: UPS Owned and/or Operated] | | | | | | [removed: Operating Leases] [added: Charters] & [removed: Charters From] [added: Leases Operated by] Others | | | | | | On Order | | | | | | Under Option | | |

| Boeing 767-300 | | | [removed: 72] [added: 78] | | | | | | — | | | | | | [removed: 28] [added: 21] | | | | | | — | | |

| Boeing 767-300BCF | | | [removed: 5] [added: 6] | | | | | | — | | | | | | — | | | | | | — | | |

| Boeing MD-11 (1) | | | [removed: 42] [added: 38] | | | | | | — | | | | | | — | | | | | | — | | |

We operate a global ground fleet of approximately [removed: 125,000] [added: 135,000] package cars, vans, tractors and motorcycles, including more than [removed: 15,000] [added: 17,000] alternative fuel and advanced technology vehicles.

We also own a number of ancillary properties that support our global operations.

| Other | | | — | | | | | | 269 | | | | | | — | | | | | | — | | |

| Total | | | 294 | | | | | | 269 | | | | | | 23 | | | | | | — | | |

(1) Two of the MD-11 aircraft shown above have been retired from operational use as of December 31, 2023.

We anticipate retiring an additional nine of these aircraft during 2024.

| | | | | | | | | | | | | | | | | | | | | | | | |

| Other | | | — | | | | | | 295 | | | | | | — | | | | | | — | | |

| Total | | | 291 | | | | | | 295 | | | | | | 30 | | | | | | — | | |

(1) Six MD-11 aircraft are expected to be retired from operational use during 2023.

During the fourth quarter of 2022, we reduced the estimated salvage value of our MD-11 fleet.

For additional information see "Critical Accounting Estimates" within Item 7.

"Management’s Discussion and Analysis of Financial Condition and Results of Operations" in Part II of this report.

As of February [removed: 3, 2023,] [added: 2, 2024,] there were [removed: 162,173] [added: 157,276] and [removed: 20,119] [added: 19,971] shareowners of record of class A and class B common stock, respectively.

On January 25, [removed: 2023,] [added: 2024,] our Board declared a dividend of [removed: $1.62] [added: $1.63] per share, which is payable on March [removed: 10, 2023] [added: 8, 2024] to shareowners of record on February [removed: 21, 2023.][added: 20, 2024.]

During the year ended December 31, [removed: 2022,] [added: 2023,] we repurchased [removed: 19.0] [added: 0.5] million shares of class B common stock for [removed: $3.5] [added: $0.1] billion under this [removed: program.][added: authorization.]

In January 2023, the Board of Directors terminated this authorization and approved a new share repurchase authorization [removed: of] [added: for] $5.0 billion [removed: for] [added: of] class A and class B common stock.

The comparison of the total cumulative return on investment, which is the change in the stock price plus reinvested dividends for each of the quarterly periods, assumes that $100 was invested on December 31, [removed: 2017] [added: 2018] in the Standard & Poor’s 500 Index, the Dow Jones Transportation Average and our class B common stock.

[removed: ][added: ]

| | | | [removed: 12/31/2017] [added: 12/31/2018] | | | | | | [removed: 12/31/2018] [added: 12/31/2019] | | | | | | [removed: 12/31/2019] [added: 12/31/2020] | | | | | | [removed: 12/31/2020] [added: 12/31/2021] | | | | | | [removed: 12/31/2021] [added: 12/31/2022] | | | | | | [removed: 12/31/2022] [added: 12/31/2023] | | |

During the year ended December 31, 2023, we repurchased 12.3 million shares of class B common stock for $2.2 billion under this authorization.

We did not repurchase any shares during the fourth quarter of 2023 and do not anticipate repurchasing any shares in 2024.

As of December 31, 2023, we had $2.8 billion available under our share repurchase authorization.

| United Parcel Service, Inc. | | | $ | 100.00 | | | | | $ | 125.49 | | | | | $ | 184.83 | | | | | $ | 242.91 | | | | | $ | 203.72 | | | | | $ | 191.59 | |

| Standard & Poor’s 500 Index | | | $ | 100.00 | | | | | $ | 132.61 | | | | | $ | 157.00 | | | | | $ | 202.02 | | | | | $ | 165.40 | | | | | $ | 169.87 | |

| Dow Jones Transportation Average | | | $ | 100.00 | | | | | $ | 121.65 | | | | | $ | 143.76 | | | | | $ | 185.91 | | | | | $ | 159.48 | | | | | $ | 178.50 | |

A summary of repurchases of our class B common stock during the fourth quarter of 2022 is as follows (in millions, except per share amounts):

| | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | Total Number of Shares Purchased (1) | | | | | | Average Price Paid Per Share | | | | | | Total Number of Shares Purchased as Part of a Publicly Announced Program | | | | | | Approximate Dollar Value of Shares that May Yet be Purchased Under the Program | | |

| October 1 - October 31, 2022 | | | 0.6 | | | | | | $ | 165.02 | | | | | 0.6 | | | | | | $ | 2,210 | |

| November 1 - November 30, 2022 | | | 0.8 | | | | | | 171.39 | | | | | | 0.8 | | | | | | 2,073 | | |

| December 1 - December 31, 2022 | | | 6.0 | | | | | | 180.57 | | | | | | 6.0 | | | | | | $ | 1,000 | |

| Total October 1 - December 31, 2022 | | | 7.4 | | | | | | $ | 178.33 | | | | | 7.4 | | | | | | | | |

(1)Includes shares repurchased through our publicly announced share repurchase programs and shares tendered to pay the exercise price and tax withholding on employee stock options.

We had approximately $1.0 billion available under this authorization as of December 31, 2022.

We anticipate repurchasing approximately $3.0 billion in shares in 2023.

| United Parcel Service, Inc. | | | $ | 100.00 | | | | | $ | 84.52 | | | | | $ | 106.07 | | | | | $ | 157.72 | | | | | $ | 205.07 | | | | | $ | 171.71 | |

| Standard & Poor’s 500 Index | | | $ | 100.00 | | | | | $ | 95.61 | | | | | $ | 126.79 | | | | | $ | 150.11 | | | | | $ | 193.16 | | | | | $ | 158.14 | |

| Dow Jones Transportation Average | | | $ | 100.00 | | | | | $ | 87.67 | | | | | $ | 106.65 | | | | | $ | 124.27 | | | | | $ | 165.54 | | | | | $ | 136.36 | |

| [Report of Independent Registered Public Accounting Firm (PCAOB ID [removed: No.](#i35a1adf6fb7e41098f62c3e95f9f5045_124) 34[)](#i35a1adf6fb7e41098f62c3e95f9f5045_124)] [added: No.](#ifcfd3c808065412fa89687f089fe8843_121) 34[)](#ifcfd3c808065412fa89687f089fe8843_121)] | | | [removed: [58](#i35a1adf6fb7e41098f62c3e95f9f5045_124)] [added: [60](#ifcfd3c808065412fa89687f089fe8843_121)] | | |

| [Consolidated Balance [removed: Sheets](#i35a1adf6fb7e41098f62c3e95f9f5045_127)] [added: Sheets](#ifcfd3c808065412fa89687f089fe8843_124)] | | | [removed: [61](#i35a1adf6fb7e41098f62c3e95f9f5045_127)] [added: [63](#ifcfd3c808065412fa89687f089fe8843_124)] | | |

| [Statements of Consolidated [removed: Income](#i35a1adf6fb7e41098f62c3e95f9f5045_130)] [added: Comprehensive Income (Loss)](#ifcfd3c808065412fa89687f089fe8843_130)] | | | [removed: [62](#i35a1adf6fb7e41098f62c3e95f9f5045_130)] [added: [64](#ifcfd3c808065412fa89687f089fe8843_130)] | | |

| [Statements of Consolidated Cash [removed: Flows](#i35a1adf6fb7e41098f62c3e95f9f5045_136)] [added: Flows](#ifcfd3c808065412fa89687f089fe8843_133)] | | | [removed: [63](#i35a1adf6fb7e41098f62c3e95f9f5045_136)] [added: [65](#ifcfd3c808065412fa89687f089fe8843_133)] | | |

[removed: | [Notes to Consolidated Financial Statements](#i35a1adf6fb7e41098f62c3e95f9f5045_139) | | | [64](#i35a1adf6fb7e41098f62c3e95f9f5045_139) | | |][added: NOTES TO CONSOLIDATED FINANCIAL STATEMENTS]

| [Note 1—Summary of Accounting [removed: Policies](#i35a1adf6fb7e41098f62c3e95f9f5045_142)] [added: Policies](#ifcfd3c808065412fa89687f089fe8843_139)] | | | [removed: [64](#i35a1adf6fb7e41098f62c3e95f9f5045_142)] [added: [66](#ifcfd3c808065412fa89687f089fe8843_139)] | | |

| [Note 2—Revenue [removed: Recognition](#i35a1adf6fb7e41098f62c3e95f9f5045_145)] [added: Recognition](#ifcfd3c808065412fa89687f089fe8843_142)] | | | [removed: [70](#i35a1adf6fb7e41098f62c3e95f9f5045_145)] [added: [73](#ifcfd3c808065412fa89687f089fe8843_142)] | | |

| [Note 3—Marketable Securities and Non-Current [removed: Investments](#i35a1adf6fb7e41098f62c3e95f9f5045_148)] [added: Investments](#ifcfd3c808065412fa89687f089fe8843_145)] | | | [removed: [73](#i35a1adf6fb7e41098f62c3e95f9f5045_148)] [added: [76](#ifcfd3c808065412fa89687f089fe8843_145)] | | |

| [removed: [Note](#i35a1adf6fb7e41098f62c3e95f9f5045_154) [4](#i35a1adf6fb7e41098f62c3e95f9f5045_154)[—Property,] [added: Property,] Plant and [removed: Equipment](#i35a1adf6fb7e41098f62c3e95f9f5045_154)] [added: Equipment] | | | [removed: [76](#i35a1adf6fb7e41098f62c3e95f9f5045_154)] [added: 20] | | |

| [removed: [Note](#i35a1adf6fb7e41098f62c3e95f9f5045_157) [5](#i35a1adf6fb7e41098f62c3e95f9f5045_157)[—Company-Sponsored] [added: [Note 5—Company-Sponsored] Employee Benefit [removed: Plans](#i35a1adf6fb7e41098f62c3e95f9f5045_157)] [added: Plans](#ifcfd3c808065412fa89687f089fe8843_151)] | | | [removed: [77](#i35a1adf6fb7e41098f62c3e95f9f5045_157)] [added: [80](#ifcfd3c808065412fa89687f089fe8843_151)] | | |

| [removed: [Note](#i35a1adf6fb7e41098f62c3e95f9f5045_160) [6](#i35a1adf6fb7e41098f62c3e95f9f5045_160)[—Multiemployer] [added: [Note 6—Multiemployer] Employee Benefit [removed: Plans](#i35a1adf6fb7e41098f62c3e95f9f5045_160)] [added: Plans](#ifcfd3c808065412fa89687f089fe8843_154)] | | | [removed: [88](#i35a1adf6fb7e41098f62c3e95f9f5045_160)] [added: [91](#ifcfd3c808065412fa89687f089fe8843_154)] | | |

| [removed: [Note](#i35a1adf6fb7e41098f62c3e95f9f5045_163) [7](#i35a1adf6fb7e41098f62c3e95f9f5045_163)[—Goodwill] [added: [Note 7—Goodwill] and Intangible [removed: Assets](#i35a1adf6fb7e41098f62c3e95f9f5045_163)] [added: Assets](#ifcfd3c808065412fa89687f089fe8843_157)] | | | [removed: [92](#i35a1adf6fb7e41098f62c3e95f9f5045_163)] [added: [95](#ifcfd3c808065412fa89687f089fe8843_157)] | | |

| [removed: [Note](#i35a1adf6fb7e41098f62c3e95f9f5045_169) [9](#i35a1adf6fb7e41098f62c3e95f9f5045_169)[—Debt] [added: [Note 9—Debt] and Financing [removed: Arrangements](#i35a1adf6fb7e41098f62c3e95f9f5045_169)] [added: Arrangements](#ifcfd3c808065412fa89687f089fe8843_163)] | | | [removed: [96](#i35a1adf6fb7e41098f62c3e95f9f5045_169)] [added: [101](#ifcfd3c808065412fa89687f089fe8843_163)] | | |

| [Note [removed: 1](#i35a1adf6fb7e41098f62c3e95f9f5045_172)[0](#i35a1adf6fb7e41098f62c3e95f9f5045_172)[—Legal] [added: 10—Legal] Proceedings and [removed: Contingencies](#i35a1adf6fb7e41098f62c3e95f9f5045_172)] [added: Contingencies](#ifcfd3c808065412fa89687f089fe8843_166)] | | | [removed: [101](#i35a1adf6fb7e41098f62c3e95f9f5045_172)] [added: [106](#ifcfd3c808065412fa89687f089fe8843_166)] | | |

| [Note [removed: 1](#i35a1adf6fb7e41098f62c3e95f9f5045_181)[3](#i35a1adf6fb7e41098f62c3e95f9f5045_181)[—Stock-Based Compensation](#i35a1adf6fb7e41098f62c3e95f9f5045_181)] [added: 13—Stock-Based Compensation](#ifcfd3c808065412fa89687f089fe8843_175)] | | | [removed: [109](#i35a1adf6fb7e41098f62c3e95f9f5045_181)] [added: [114](#ifcfd3c808065412fa89687f089fe8843_175)] | | |

| [Note [removed: 1](#i35a1adf6fb7e41098f62c3e95f9f5045_187)[4](#i35a1adf6fb7e41098f62c3e95f9f5045_187)[—Segment] [added: 14—Segment] and Geographic [removed: Information](#i35a1adf6fb7e41098f62c3e95f9f5045_187)] [added: Information](#ifcfd3c808065412fa89687f089fe8843_181)] | | | [removed: [113](#i35a1adf6fb7e41098f62c3e95f9f5045_187)] [added: [118](#ifcfd3c808065412fa89687f089fe8843_181)] | | |

| [Note [removed: 1](#i35a1adf6fb7e41098f62c3e95f9f5045_193)[6](#i35a1adf6fb7e41098f62c3e95f9f5045_193)[—Earnings] [added: 16—Earnings] Per [removed: Share](#i35a1adf6fb7e41098f62c3e95f9f5045_193)] [added: Share](#ifcfd3c808065412fa89687f089fe8843_187)] | | | [removed: [121](#i35a1adf6fb7e41098f62c3e95f9f5045_193)] [added: [126](#ifcfd3c808065412fa89687f089fe8843_187)] | | |

| [Note [removed: 1](#i35a1adf6fb7e41098f62c3e95f9f5045_196)[7](#i35a1adf6fb7e41098f62c3e95f9f5045_196)[—Derivative] [added: 17—Derivative] Instruments and Risk [removed: Management](#i35a1adf6fb7e41098f62c3e95f9f5045_196)] [added: Management](#ifcfd3c808065412fa89687f089fe8843_190)] | | | [removed: [122](#i35a1adf6fb7e41098f62c3e95f9f5045_196)] [added: [127](#ifcfd3c808065412fa89687f089fe8843_190)] | | |

| [Note [removed: 1](#i35a1adf6fb7e41098f62c3e95f9f5045_199)[8](#i35a1adf6fb7e41098f62c3e95f9f5045_199)[—Transformation] [added: 18—Transformation] Strategy [removed: Costs](#i35a1adf6fb7e41098f62c3e95f9f5045_199)] [added: Costs](#ifcfd3c808065412fa89687f089fe8843_193)] | | | [removed: [126](#i35a1adf6fb7e41098f62c3e95f9f5045_199)] [added: [131](#ifcfd3c808065412fa89687f089fe8843_193)] | | |

We have audited the accompanying consolidated balance sheets of United Parcel Service, Inc. and subsidiaries (the "Company") as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] the related consolidated statements of income, comprehensive income, and cash flows, for each of the three years in the period ended December 31, [removed: 2022,] [added: 2023,] and the related notes (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2022,] [added: 2023,] in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ("PCAOB"), the Company's internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in *Internal Control — Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 20, [removed: 2023,] [added: 2024,] expressed an unqualified opinion on the Company's internal control over financial reporting.

Valuation of U.S. hedge fund, [removed: risk parity,] private debt, private equity and real estate investments — Refer to Note 5, Company-Sponsored Employee Benefit Plans (Fair Value Measurements), to the financial statements

The Company’s U.S. pension and postretirement medical benefit plans (the "U.S. Plans") held hedge fund, [removed: risk parity,] private debt, private equity and real estate investments valued at [removed: $9.6] [added: $9.9] billion as of December 31, [removed: 2022.][added: 2023.]

The Company determines the reported values of the U.S. Plans’ investments in hedge, [removed: risk parity,] private debt, private equity and real estate funds primarily based on the estimated net asset value ("NAV") of the fund.

In order to estimate NAV, the Company evaluates audited and unaudited financial reports from fund managers, and makes adjustments, as appropriate, for investment activity between the date of the financial reports and December [removed: 31st.][added: 31.]

Auditing the estimated NAV of these hedge fund, [removed: risk parity,] private debt, private equity and real estate investments requires a high degree of auditor judgment and subjectivity to evaluate the completeness, reliability and relevance of the inputs used by management.

Our audit procedures related to the inputs used by management to estimate the NAV of the U.S. Plans’ hedge fund, [removed: risk parity,] private debt, private equity and real estate investments included the following, among others:

- For certain investments, we confirmed directly with the respective fund manager its preliminary estimate of the fund’s NAV as of December 31, [removed: 2022.][added: 2023.]

Approximately [removed: 84] [added: 86] percent of the Company’s revenues are from its global small package operations that provide time-definite delivery services for express letters, documents, small packages and palletized freight via air and ground services.

[removed: February 20, 2023][added: | | | | 2023 | | | | | | | | |]

| | | | [added: 2023 | | | | | |] 2022 | | | | | | 2021 | | |

| Cash and cash equivalents | | | $ | [removed: 5,602] [added: 3,206] | | | | | $ | [removed: 10,255] [added: 5,602] | |

| Marketable securities | | | [removed: 1,993] [added: 2,866] | | | | | | [removed: 338] [added: 1,993] | | |

| Accounts receivable | | | [removed: 12,729] [added: 11,342] | | | | | | [removed: 12,669] [added: 12,729] | | |

| Less: Allowance for credit losses | | | [removed: (146)] [added: (126)] | | | | | | [removed: (128)] [added: (146)] | | |

| Accounts receivable, net | | | [removed: 12,583] [added: 11,216] | | | | | | [removed: 12,541] [added: 12,583] | | |

| Other current assets | | | [removed: 2,039] [added: 2,125] | | | | | | [removed: 1,800] [added: 2,039] | | |

| Total Current Assets | | | [removed: 22,217] [added: 19,413] | | | | | | [removed: 24,934] [added: 22,217] | | |

| Property, Plant and Equipment, Net | | | [removed: 34,719] [added: 36,945] | | | | | | [removed: 33,475] [added: 34,719] | | |

| [Statements of Consolidated Income](#ifcfd3c808065412fa89687f089fe8843_127) | | | [64](#ifcfd3c808065412fa89687f089fe8843_127) | | |

| [Notes to Consolidated Financial Statements](#ifcfd3c808065412fa89687f089fe8843_136) | | | [66](#ifcfd3c808065412fa89687f089fe8843_136) | | |

| [Note 8—Acquisitions](#ifcfd3c808065412fa89687f089fe8843_160) | | | [98](#ifcfd3c808065412fa89687f089fe8843_160) | | |

| [Note 11—Leases](#ifcfd3c808065412fa89687f089fe8843_169) | | | [107](#ifcfd3c808065412fa89687f089fe8843_169) | | |

| [Note 12—Shareowners’ Equity](#ifcfd3c808065412fa89687f089fe8843_172) | | | [110](#ifcfd3c808065412fa89687f089fe8843_172) | | |

| [Note 15—Income Taxes](#ifcfd3c808065412fa89687f089fe8843_184) | | | [121](#ifcfd3c808065412fa89687f089fe8843_184) | | |

February 20, 2024

| | | | 2023 | | | | | | 2022 | | |

| Accounts payable | | | 6,340 | | | | | | 7,515 | | |

| Compensation and benefits | | | 47,088 | | | | | | 47,720 | | | | | | 46,640 | | |

| Repairs and maintenance | | | 2,828 | | | | | | 2,884 | | | | | | 2,769 | | |

| Purchased transportation | | | 13,651 | | | | | | 17,675 | | | | | | 19,079 | | |

| Other occupancy | | | 2,019 | | | | | | 1,844 | | | | | | 1,719 | | |

| Other expenses | | | 8,090 | | | | | | 7,915 | | | | | | 7,470 | | |

| Net Income | | | $ | 6,708 | | | | | $ | 11,548 | | | | | $ | 12,890 | |

| Net income | | | $ | 6,708 | | | | | $ | 11,548 | | | | | $ | 12,890 | |

| Depreciation and amortization | | | 3,366 | | | | | | 3,188 | | | | | | 2,953 | | |

In 2023, we reclassified certain operating expenses to better align with the manner in which we manage our operations.

Substantially all of these costs were previously classified within operating expenses as *Other expenses* and have now been classified within operating expenses as *Repairs and maintenance* in the statements of consolidated income.

The remaining line items within operating expenses impacted by this reclassification were inconsequential.

As a result, the statements of consolidated income give effect to this reclassification as follows:

- *Other expenses* decreased by $381, $356 and $301 million for 2023, 2022 and 2021, respectively.

- *Repairs and maintenance* increased by $363, $369 and $326 million for 2023, 2022 and 2021, respectively.

The reclassification had no impact on our reported revenue, operating profit, net income, or any internal performance measure on which management is compensated.

As of December 31, 2023, we had $37 million of restricted cash related to certain tax and regulatory matters and acquisitions.

We had no restricted cash as of December 31, 2022.

Property, plant and equipment are carried at cost less accumulated depreciation.

Our estimates are developed using assumptions that we believe are consistent with how a market participant would value our reporting units.

When performing impairment tests of indefinite-lived intangible assets, we use a combination of income- and market-based approaches to estimate fair value.

Finite-lived intangible assets are assessed for impairment as part of asset groups whenever events or changes in circumstances indicate that their carrying value may not be recoverable.

*Supplier Finance Programs*

As part of our working capital management, certain financial institutions offer a Supply Chain Finance ("SCF") program to certain of our suppliers.

We agree to commercial terms with our suppliers, including prices, quantities and payment terms, regardless of whether the supplier elects to participate in the SCF program.

Suppliers issue invoices to us based on the agreed-upon contractual terms.

If they participate in the SCF program, our suppliers, at their sole discretion, determine which invoices, if any, to sell to the financial institutions.

Our suppliers’ voluntary inclusion of invoices in the SCF program has no bearing on our payment terms.

No guarantees are provided by us under the SCF program.

We have no economic interest in a supplier’s decision to participate, and we have no direct financial relationship with the financial institutions, as it relates to the SCF program.

Amounts due to our suppliers that participate in the SCF program are included in *Accounts payable* in our consolidated balance sheets.

As of December 31, 2023 and 2022, suppliers sold $504 and $806 million, respectively, of our outstanding payment obligations to participating institutions.

| [Statements of Consolidated Comprehensive Income (Loss)](#i35a1adf6fb7e41098f62c3e95f9f5045_133) | | | [62](#i35a1adf6fb7e41098f62c3e95f9f5045_133) | | |

| [Note 8—Acquisitions](#i35a1adf6fb7e41098f62c3e95f9f5045_166) | | | [94](#i35a1adf6fb7e41098f62c3e95f9f5045_166) | | |

| [Note 1](#i35a1adf6fb7e41098f62c3e95f9f5045_175)[1](#i35a1adf6fb7e41098f62c3e95f9f5045_175)[—Leases](#i35a1adf6fb7e41098f62c3e95f9f5045_175) | | | [102](#i35a1adf6fb7e41098f62c3e95f9f5045_175) | | |

| [Note 1](#i35a1adf6fb7e41098f62c3e95f9f5045_178)[2](#i35a1adf6fb7e41098f62c3e95f9f5045_178)[—Shareowners’ Equity](#i35a1adf6fb7e41098f62c3e95f9f5045_178) | | | [105](#i35a1adf6fb7e41098f62c3e95f9f5045_178) | | |

| [Note 1](#i35a1adf6fb7e41098f62c3e95f9f5045_190)[5](#i35a1adf6fb7e41098f62c3e95f9f5045_190)[—Income Taxes](#i35a1adf6fb7e41098f62c3e95f9f5045_190) | | | [116](#i35a1adf6fb7e41098f62c3e95f9f5045_190) | | |

- For certain investments, we inquired of management to understand year-over-year changes in the fund manager’s estimate of NAV and compared the fund’s return on investment to other available qualitative and quantitative information relevant to the fund.

| | | | | | | | | | | | |

| Accounts payable | | | 7,512 | | | | | | 7,523 | | |

| | | | | | | | | | | | | | | | | | |

| Compensation and benefits | | | 47,781 | | | | | | 46,707 | | | | | | 44,529 | | |

| Repairs and maintenance | | | 2,515 | | | | | | 2,443 | | | | | | 2,365 | | |

| Purchased transportation | | | 17,653 | | | | | | 19,058 | | | | | | 15,631 | | |

| Other occupancy | | | 1,818 | | | | | | 1,698 | | | | | | 1,539 | | |

| Other expenses | | | 8,271 | | | | | | 7,771 | | | | | | 7,600 | | |

| Net change in finance receivables | | | 24 | | | | | | 34 | | | | | | 44 | | |

In particular, a number of estimates have been and will continue to be affected by the ongoing COVID-19 pandemic.

The pandemic and its economic consequences remain uncertain, are changing and are difficult to predict.

As a result, our accounting estimates and assumptions may change over time.

*UPS Freight:* Prior to the divestiture in 2021, revenue was recognized over time as we performed the services in the contract.

As of December 31, 2022 and 2021, we did not have any restricted cash balances.

We have both the intent and ability to hold these securities for the time necessary to recover the cost basis.

When performing impairment tests of indefinite-lived intangible assets, the estimated fair value is compared to the carrying value of the asset.

In December 2019, the Financial Accounting Standards Board issued an Accounting Standards Update ("ASU") to simplify the accounting for income taxes.

The update removes certain exceptions to the general income tax principles.

Effective October 1, 2020, we early adopted this ASU.

The guidance was effective upon issuance and at present can generally be applied through December 31, 2024.

We are evaluating the potential impacts of reference rate reform on our various contractual positions to determine whether we may apply any of the practical expedients set forth in this standard; however, we do not expect reference rate reform to have a material impact on our consolidated financial position, results of operations, cash flows, or internal controls.

We increased our allowance for expected credit losses by $18 million during 2022 based upon current forecasts that reflect changes in the economic outlook.

| | | | | | | | | | | | | | | | | | | | | | | | |

| 2021 | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Corporate debt securities | | | 592 | | | | | | (3) | | | | | | 51 | | | | | | (3) | | | | | | 643 | | | | | | (6) | | |

| Total marketable securities | | | $ | 808 | | | | | $ | (7) | | | | | $ | 123 | | | | | $ | (7) | | | | | $ | 931 | | | | | $ | (14) | |

| | | | 2,005 | | | | | | 1,991 | | |

| | | | $ | 2,007 | | | | | $ | 1,993 | |

| Total marketable securities | | | 200 | | | | | | 138 | | | | | | — | | | | | | 338 | | |

| Total | | | $ | 200 | | | | | $ | 161 | | | | | $ | — | | | | | $ | 361 | |

| | | | 67,430 | | | | | | 64,809 | | |

We recognized impairment charges of $71 million during the year ended December 31, 2021, due to the reevaluation of certain facility projects.

UPS contributes 3% to 8% of eligible pay to the UPS 401(k) Savings Plan based on years of vesting service and business unit.

There were no changes in our internal control over financial reporting during the quarter ended December 31, [removed: 2022] [added: 2023] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Based on the criteria for effective internal control over financial reporting established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission, management has assessed our internal control over financial reporting as effective as of December 31, [removed: 2022.][added: 2023.]

The independent registered public accounting firm of Deloitte & Touche LLP, as auditors of the consolidated balance sheets of United Parcel Service, Inc. and its subsidiaries as of December 31, [removed: 2022] [added: 2023] and the related statements of consolidated income, consolidated comprehensive income and consolidated cash flows for the year ended December 31, [removed: 2022,] [added: 2023,] has issued an attestation report on our internal control over financial reporting, which is included herein.

We have audited the internal control over financial reporting of United Parcel Service, Inc. and subsidiaries (the "Company") as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in [removed: Internal] [added: *Internal] Control — Integrated Framework [removed: (2013)] [added: (2013)*] issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2022,] [added: 2023,] based on criteria established in [removed: Internal] [added: *Internal] Control — Integrated Framework [removed: (2013)] [added: (2013)*] issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ("PCAOB"), the consolidated financial statements as of and for the year ended December 31, [removed: 2022,] [added: 2023,] of the Company and our report dated February 20, [removed: 2023,] [added: 2024,] expressed an unqualified opinion on those financial statements.

February 20, 2024

February 20, 2023

*Insider Trading Arrangements and Policies*

| Carol B.Tomé Chief Executive Officer | | | | | | [removed: 66] [added: 67] | | | | | | Chief Executive Officer (2020 - present), Chief Financial Officer, The Home Depot, Inc. (2001 - 2019). | | |

| Norman M. Brothers, Jr. Executive Vice President; Chief Legal and Compliance Officer and Corporate Secretary | | | | | | [removed: 55] [added: 56] | | | | | | Chief Legal and Compliance Officer and Corporate Secretary (2020 - present), Senior Vice President, General Counsel and Corporate Secretary (2016 - 2020). | | |

| Nando Cesarone Executive Vice President; President, U.S. | | | | | | [removed: 51] [added: 52] | | | | | | President, U.S. (2020 - present), President, UPS International (2018 - 2020), Europe Region Manager (2016 - 2018). | | |

| Darrell Ford Executive Vice President; Chief Human Resources Officer and Chief Diversity, Equity and Inclusion Officer | | | | | | [removed: 58] [added: 59] | | | | | | Chief Human Resources Officer and Chief Diversity, Equity and Inclusion Officer (2022 - present), Chief Human Resources Officer (2021 - 2022), Chief Human Resources Officer, DuPont (2018 - 2020), Chief Human Resources Officer, Xerox Corporation (2015 - 2018). | | |

| Kate M. Gutmann Executive Vice President; President International, Healthcare and Supply Chain Solutions | | | | | | [removed: 54] [added: 55] | | | | | | President International, Healthcare and Supply Chain Solutions (2022 - present), Chief Sales and Solutions Officer, Executive Vice President, UPS Global Healthcare (2020 - 2022), Chief Sales and Solutions Officer; Senior Vice President The UPS Store and UPS Capital (2017 - 2019). | | |

| Laura Lane Executive Vice President; Chief Corporate Affairs, Communications and Sustainability Officer | | | | | | [removed: 56] [added: 57] | | | | | | Chief Corporate Affairs, Communications and Sustainability Officer (2020 - present), Chief Corporate Affairs and Communications Officer (August 2020 - October 2020), President, Global Public Affairs (2011 - 2020). | | |

| Brian Newman Executive Vice President; Chief Financial Officer | | | | | | [removed: 54] [added: 55] | | | | | | Chief Financial Officer (2021 - present), Chief Financial Officer and Treasurer (2019 - 2021), Executive Vice President, Finance and Operations, Latin America, PepsiCo, Inc. (2017 - 2019). | | |

| Bala Subramanian Executive Vice President; Chief Digital and Technology Officer | | | | | | [removed: 51] [added: 52] | | | | | | Chief Digital and Technology Officer (2022 - present), Chief Digital Officer, AT&T Inc. (2018 - 2022), Chief Digital Officer, Best Buy Co., Inc. (2017 - 2018). | | |

Information about our directors will be presented under the caption "Our Board of Directors" in our definitive proxy statement for our meeting of shareowners to be held on May [removed: 4, 2023] [added: 2, 2024] (the "Proxy Statement") and is incorporated herein by reference.

Information with respect to compliance with Section 16(a) of the Exchange Act will be presented under the caption [removed: "Delinquent] [added: "Ownership of Our Securities - Delinquent] Section 16(a) Reports" in our Proxy Statement and is incorporated herein by reference.

| Matt Guffey Executive Vice President; Chief Commercial and Strategy Officer | | | | | | 45 | | | | | | Chief Commercial and Strategy Officer (present), Senior Vice President, Global Strategy (2020 - 2023), President, Corporate Strategy (2020), Marketing Department Manager (2019 - 2020), Product Management Senior Director (2018). | | |

| | | | | | | | | | | | | | | |

| Kevin Warren Executive Vice President; Chief Marketing Officer | | | | | | 60 | | | | | | Chief Marketing Officer (2018 - present), Executive Vice President and Chief Commercial Officer, Xerox Corporation (2017 - 2018). | | |

Information about director independence will be presented under the caption [removed: "Corporate Governance] [added: "Our Board of Directors] - Director Independence" in our Proxy Statement and is incorporated herein by reference.

| 3.2 | | | — | | | [Amended and Restated Bylaws of United Parcel Service, [removed: Inc. as of November 17, 2017 (incorporated] [added: Inc.](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000029/exhibit31-upsbylawamendmen.htm) [(incorporated] by reference to Exhibit 3.1 to Form 8-K, filed [removed: on November 17, 2017).](http://www.sec.gov/Archives/edgar/data/1090727/000110465917069458/a17-27256_1ex3d1.htm)] [added: on](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000029/exhibit31-upsbylawamendmen.htm) [May](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000029/exhibit31-upsbylawamendmen.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000029/exhibit31-upsbylawamendmen.htm)[9](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000029/exhibit31-upsbylawamendmen.htm)[, 20](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000029/exhibit31-upsbylawamendmen.htm)[23](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000029/exhibit31-upsbylawamendmen.htm)[).](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000029/exhibit31-upsbylawamendmen.htm)] | | |

| 4.22 | | | — | | | [Form [removed: of 0.375%] [added: of](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm) [4](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)[.](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)[875](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)[%] Senior Notes [removed: due November 15, 2023] [added: due](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm) [20](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)[3](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)[3] (incorporated by reference to Exhibit 4.1 to Form 8-K, filed [removed: on November 13, 2017).](http://www.sec.gov/Archives/edgar/data/1090727/000119312517341108/d442730dex41.htm)] [added: on](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm) [February](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)[27](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)[, 20](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)[23](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)[).](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex41.htm)] | | |

| [removed: 4.24] [added: 4.25] | | | — | | | [Form [removed: of Floating] [added: of](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm) [Floating] Rate [removed: Senior Notes due April 1, 2023] [added: Senior](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm)[Notes due](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm) [20](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm)[7](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm)[3] (incorporated by reference to Exhibit [removed: 4.2 to] [added: 4.](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm)[1](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm) [to] Form 8-K, filed [removed: on November 14, 2017).](http://www.sec.gov/Archives/edgar/data/1090727/000119312517342753/d497986dex42.htm)] [added: on](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm) [March 7](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm)[, 20](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm)[23](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm)[).](https://www.sec.gov/Archives/edgar/data/1090727/000119312523062960/d468023dex41.htm)] | | |

| [removed: 4.25] [added: 4.24] | | | — | | | [Form [removed: of 2.500% Senior Notes due April 1, 2023] [added: of](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm) [5.050%](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm) [Notes due](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm) [20](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm)[5](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm)[3] (incorporated by reference to Exhibit [removed: 4.4] [added: 4.2] to Form 8-K, filed [removed: on November 14, 2017).](http://www.sec.gov/Archives/edgar/data/1090727/000119312517342753/d497986dex44.htm)] [added: on](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm) [February](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm)[27](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm)[, 20](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm)[23](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm)[).](https://www.sec.gov/Archives/edgar/data/1090727/000119312523050804/d466921dex42.htm)] | | |

| [removed: 4.39] [added: 10.14] | | | — | | | [removed: [Description of Securities] [added: [Retention Arrangement Letter between UPS and Nando Cesarone, dated April 15, 2020] (incorporated by reference to Exhibit [removed: 4.42] [added: 10.20] to Form 10-K for the year ended December 31, [removed: 2020).](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhibit442.htm)] [added: 2020).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhbit1020.htm)] | | |

| 10.2 | | | — | | | [Amended and Restated UPS 401(k) Savings Plan, effective as of January 1, [removed: 2023.*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit102.htm)] [added: 2023](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit102.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit102.htm)[(incorporated by reference to Exhib](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit102.htm)[it 10.2 to F](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit102.htm)[orm 10-K for th](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit102.htm)[e year ended December 31, 2022).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit102.htm)] | | |

| 10.3 | | | — | | | [Amended and Restated [removed: Restoration](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm) [Savings Plan](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)[,](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm) [effective](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm) [as of](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm) [January] [added: Restoration Savings Plan, effective as of January] 1, [removed: 2023.](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)[*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)] [added: 2023](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)[(inco](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)[r](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)[porated by refe](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)[rence to Exhibit 10.3 to Form 10-K for the](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)[year ended December 31, 2022)](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)[.*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit103.htm)] | | |

| [removed: 10.8(a)] [added: 10.9] | | | — | | | [UPS [removed: Management Incentive] [added: Stock Option] Program Amended and Restated Terms and Conditions effective November 8, 2018 (incorporated by reference to Exhibit [removed: 10.8(a)] [added: 10.8(b)] to Form 10-K for the year ended December 31, [removed: 2018).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072719000006/ups-12312018xexhibit108a.htm)] [added: 2018).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072719000006/ups-12312018xexhibit108b.htm)] | | |

| [removed: 10.8(b)] [added: 10.11] | | | — | | | [UPS [removed: Stock Option] [added: Long-Term Incentive Performance] Program Amended and Restated Terms and Conditions effective [removed: November 8, 2018] [added: as of February 13, 2020] (incorporated by reference to Exhibit [removed: 10.8(b)] [added: 10.16] to Form 10-K for the year ended December 31, [removed: 2018).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072719000006/ups-12312018xexhibit108b.htm)] [added: 2019).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072720000005/ups-12312019xexhbit1016.htm)] | | |

| [removed: 10.9] [added: 10.16] | | | — | | | [removed: [Form of Protective] [added: [Protective] Covenant Agreement between [removed: the Company] [added: UPS] and [removed: Kevin Warren (incorporated] [added: Bala Subramanian, dated May 24, 2022](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1018.htm) [(incorporated] by reference to Exhibit [removed: 10.12] [added: 10.18] to Form 10-K for the year ended December 31, [removed: 2018).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072719000006/ups-12312018xexhibit1012.htm)] [added: 2022)](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1018.htm)[.*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1018.htm)] | | |

| 10.10 | | | — | | | [removed: [Employment offer letter agreement] [added: [Protective Covenant Agreement] between the Company and Brian Newman, dated August 7, 2019 (incorporated by reference to Exhibit [removed: 10.1] [added: 10.2] to Form 8-K filed on August 13, [removed: 2019).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072719000048/exhibit101-offerofempl.htm)] [added: 2019).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072719000048/exhibit102-upsprotecti.htm)] | | |

| [removed: 10.11] [added: 10.12] | | | — | | | [Protective Covenant Agreement between [removed: the Company] [added: UPS] and [removed: Brian Newman,] [added: Carol Tomé,] dated [removed: August 7, 2019] [added: March 11, 2020] (incorporated by reference to Exhibit 10.2 to Form 8-K filed on [removed: August] [added: March] 13, [removed: 2019).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072719000048/exhibit102-upsprotecti.htm)] [added: 2020).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072720000010/exhibit102-upsprotecti.htm)] | | |

| [removed: 10.12] [added: 10.23] | | | — | | | [UPS Long-Term Incentive Performance Program Amended and Restated Terms and [removed: Conditions] [added: Conditions,] effective as of [removed: February 13, 2020] [added: March 22, 2023] (incorporated by reference to Exhibit [removed: 10.16] [added: 10.3] to Form [removed: 10-K] [added: 10-Q] for the [removed: year] [added: quarter] ended [removed: December] [added: March] 31, [removed: 2019).](http://www.sec.gov/Archives/edgar/data/1090727/000109072720000005/ups-12312019xexhbit1016.htm)[*](http://www.sec.gov/Archives/edgar/data/1090727/000109072720000005/ups-12312019xexhbit1016.htm)] [added: 2023).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000025/ups-03312023xex103.htm)] | | |

| [removed: 10.13] [added: 10.15] | | | — | | | [Employment offer letter agreement between UPS and [removed: Carol B Tomé,] [added: Bala Subramanian,] dated [removed: March 11, 2020 (incorporated] [added: May 24, 2022](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1017.htm) [(incorporated] by reference to Exhibit [removed: 10.1] [added: 10.17] to Form [removed: 8-K filed on March 13, 2020).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072720000010/exhibit101-offerofempl.htm)] [added: 10-K for the year ended December 31, 2022)](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1017.htm)[.*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1017.htm)] | | |

| [removed: 10.15] [added: 10.13] | | | — | | | [Form of Protective Covenant Agreement between UPS and each of Nando [removed: Cesarone](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhibit1019.htm) [and](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhibit1019.htm) [Kate Gutmann](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhibit1019.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhibit1019.htm)[(incorporated] [added: Cesarone and Kate Gutmann (incorporated] by reference to Exhibit 10.19 to Form 10-K for the year ended December 31, 2020).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhibit1019.htm) | | |

| [removed: 10.16] [added: 10.20] | | | — | | | [Retention Arrangement Letter between UPS and [removed: Nando Cesarone,] [added: Kate Gutmann,] dated April 15, 2020 (incorporated by reference to Exhibit [removed: 10.20] [added: 10.21] to Form 10-K for the year ended December 31, [removed: 2020).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhbit1020.htm)] [added: 2020).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhibit1021.htm)] | | |

| [removed: 10.19] [added: 10.17] | | | — | | | [United Parcel Service, Inc. Key Employee Severance Plan (incorporated by reference [removed: to](https://www.sec.gov/Archives/edgar/data/1090727/000109072722000025/exhibit101-upskeyemployees.htm) [Exhibit 10.1](https://www.sec.gov/Archives/edgar/data/1090727/000109072722000025/exhibit101-upskeyemployees.htm) [to](https://www.sec.gov/Archives/edgar/data/1090727/000109072722000025/exhibit101-upskeyemployees.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000109072722000025/exhibit101-upskeyemployees.htm)[Form] [added: to Exhibit 10.1 to Form] 8-K, filed on May 10, 2022).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072722000025/exhibit101-upskeyemployees.htm) | | |

| [removed: 10.20] [added: 10.18] | | | — | | | [UPS Management Incentive Program Amended and Restated Terms and Conditions effective November 3, [removed: 2022.*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1020.htm)] [added: 2022](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1020.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1020.htm)[(incorporated by refer](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1020.htm)[ence to Exhibit 10.20 to Form 10-K for the year en](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1020.htm)[ded December 31](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1020.htm)[, 202](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1020.htm)[2](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1020.htm)[).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1020.htm)] | | |

| [removed: 10.21] [added: 10.19] | | | — | | | [UPS Management Incentive Program Amended and Restated Terms and Conditions effective January 1, [removed: 2023.*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1021.htm)] [added: 2023](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1021.htm) [](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1021.htm)[(incorporated by reference to Exhibit 10.2](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1021.htm)[1](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1021.htm) [to Form 10-K for the year ended December 31, 202](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1021.htm)[2](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1021.htm)[).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1021.htm)] | | |

| [removed: 10.23] [added: 10.21] | | | — | | | [UPS Long-Term Incentive Performance Program Amended and Restated Terms and Conditions effective as of March 25, 2021 (incorporated by reference to Exhibit 10.1 to Form 10-Q for the quarter ended March 31, 2021).*](https://www.sec.gov/Archives/edgar/data/0001090727/000109072721000019/ups-03312021xexhibit101.htm) | | |

| [removed: 10.24] [added: 10.22] | | | — | | | [United Parcel Service, Inc. 2021 Omnibus Incentive Compensation Plan (incorporated by reference to Annex A to the definitive proxy statement on Schedule 14A filed March 29, 2021).*](http://www.sec.gov/Archives/edgar/data/1090727/000120677421000883/ups3861781-def14a.htm#d386178a063) | | |

| 21 | | | — | | | [removed: [Subsidiaries.](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit21.htm)] [added: [Subsidiaries.](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit21.htm)] | | |

| 23 | | | — | | | [Consent of Deloitte & Touche [removed: LLP.](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit23.htm)] [added: LLP.](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit23.htm)] | | |

| 31.1 | | | — | | | [removed: [Certificate of] [added: [Certificat](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit311.htm)[ion](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit311.htm) [of] the Principal Executive Officer Pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit311.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit311.htm)] | | |

| 31.2 | | | — | | | [removed: [Certificate of] [added: [Certificat](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit312.htm)[ion](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit312.htm) [of] the Principal Financial and Accounting Officer Pursuant to Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit312.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit312.htm)] | | |

| 32.1 | | | — | | | [Certification of the Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit321.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit321.htm)] | | |

| 32.2 | | | — | | | [Certification of the Principal Financial and Accounting Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of [removed: 2002.](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit322.htm)] [added: 2002.](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit322.htm)] | | |

| 101 | | | — | | | The following financial information from the Annual Report on Form 10-K for the year ended December 31, [removed: 2022,] [added: 2023,] formatted in Inline XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income (Loss), (iv) the Consolidated Statements of Cash Flows and (v) the Notes to the Consolidated Financial Statements. | | |

| 104 | | | — | | | Cover Page Interactive Data File - The cover page from this Annual Report on Form 10-K for the year ended December 31, [removed: 2022] [added: 2023] is formatted in iXBRL (included as Exhibit 101). | | |

Date: February 20, [removed: 2023][added: 2024]

| /S/ CAROL B. TOMÉ | | | | | | Chief Executive Officer | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| /S/ BRIAN O. NEWMAN | | | | | | Executive Vice President and Chief Financial Officer | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| /S/ RODNEY C. ADKINS | | | | | | Director | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| /S/ EVA C. BORATTO | | | | | | Director | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| /S/ MICHAEL J. BURNS | | | | | | Director | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| /S/ WAYNE M. HEWETT | | | | | | Director | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| /S/ ANGELA HWANG | | | | | | Director | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| /S/ KATE E. JOHNSON | | | | | | Director | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| /S/ WILLIAM R. JOHNSON | | | | | | Director | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| /S/ FRANCK J. MOISON | | | | | | Director | | | | | | February 20, [removed: 2023] [added: 2024] | | |

| 4.39 | | | — | | | [Description of Securities](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit439.htm)[.](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit439.htm) | | |

| 97 | | | — | | | [UPS Incentive-Based Compensation Clawback Policy.](https://www.sec.gov/Archives/edgar/data/1090727/000109072724000008/ups-12312023xexhibit97.htm) | | |

| | | | | | | | | |

| 10.14 | | | — | | | [Protective Covenant Agreement between UPS and Carol Tomé, dated March 11, 2020 (incorporated by reference to Exhibit 10.2 to Form 8-K filed on March 13, 2020).*](http://www.sec.gov/Archives/edgar/data/1090727/000109072720000010/exhibit102-upsprotecti.htm) | | |

| 10.17 | | | — | | | [Employment offer letter agreement between UPS and Bala Subramanian, dated Ma](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1017.htm)[y 24](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1017.htm)[, 2022.*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1017.htm) | | |

| 10.18 | | | — | | | [Protective Covenant Agreement between UPS and Bala Subramanian, dated](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1018.htm) [Ma](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1018.htm)[y 24](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1018.htm)[, 2022](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1018.htm)[.*](https://www.sec.gov/Archives/edgar/data/1090727/000109072723000006/ups-12312022xexhibit1018.htm) | | |

| 10.22 | | | — | | | [Retention Arrangement Letter between UPS and Kate Gutmann, dated April 15, 2020 (incorporated by reference to Exhibit 10.21 to Form 10-K for the year ended December 31, 2020).*](https://www.sec.gov/Archives/edgar/data/1090727/000109072721000013/ups-12312020xexhibit1021.htm) | | |

| | | | | | | | | | | | | | | |

| /S/ ANN M. LIVERMORE | | | | | | Director | | | | | | February 20, 2023 | | |

| Ann M. Livermore | | | | | | | | | | | | | | |