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Table of Contents
United States
Securities and Exchange Commission
Washington, D.C. 20549
_____________________________________ 
Form 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024 or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to             
Commission file number 001-15451
_____________________________________ 
g795027a09.jpg
United Parcel Service, Inc.
(Exact name of registrant as specified in its charter)
Delaware 58-2480149
(State or Other Jurisdiction of
Incorporation or Organization)
 (IRS Employer
Identification No.)
55 Glenlake Parkway N.E. ,Atlanta, Georgia30328
(Address of Principal Executive Offices) (Zip Code)
(404) 828-6000
(Registrant’s telephone number, including area code)
____________________ 
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
Class B common stock, par value $0.01 per shareUPSNew York Stock Exchange
1.625% Senior Notes due 2025UPS25New York Stock Exchange
1% Senior Notes due 2028UPS28New York Stock Exchange
1.500% Senior Notes due 2032UPS32New York Stock Exchange
  
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
x
Accelerated filer
Non-accelerated filer  
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  
There were 126,159,503 Class A shares, and 729,399,444 Class B shares, with a par value of $0.01 per share, outstanding at April 17, 2024.


Table of Contents
TABLE OF CONTENTS
PART I—FINANCIAL INFORMATION
Item 1.
Item 2.
Item 3.
Item 4.
PART II—OTHER INFORMATION
Item 1.
Item 1A.
Item 2.
Item 5.
Item 6.



Table of Contents
PART I. FINANCIAL INFORMATION

Cautionary Statement About Forward-Looking Statements
This report, our Annual Report on Form 10-K for the year ended December 31, 2023 and our other filings with the Securities and Exchange Commission contain and in the future may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than those of current or historical fact, and all statements accompanied by terms such as “will,” “believe,” “project,” “expect,” “estimate,” “assume,” “intend,” “anticipate,” “target,” “plan,” and similar terms, are intended to be forward-looking statements. Forward-looking statements are made subject to the safe harbor provisions of the federal securities laws pursuant to Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
From time to time, we also include written or oral forward-looking statements in other publicly disclosed materials. Such statements may relate to our intent, belief, forecasts of, or current expectations about our strategic direction, prospects, future results, or future events; they do not relate strictly to historical or current facts. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any forward-looking statements because such statements speak only as of the date when made and the future, by its very nature, cannot be predicted with certainty.
Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or anticipated results. These risks and uncertainties include, but are not limited to: changes in general economic conditions in the United States ("U.S.") or internationally; significant competition on a local, regional, national and international basis; changes in our relationships with our significant customers; our ability to attract and retain qualified employees; strikes, work stoppages or slowdowns by our employees; increased or more complex physical or operational security requirements; a significant cybersecurity incident, or increased data protection regulations; our ability to maintain our brand image and corporate reputation; impacts from global climate change; interruptions in or impacts on our business from natural or man-made events or disasters including terrorist attacks, epidemics or pandemics; exposure to changing economic, political, regulatory and social developments in international and emerging markets; our ability to realize the anticipated benefits from acquisitions, dispositions, joint ventures or strategic alliances; the effects of changing prices of energy, including gasoline, diesel, jet fuel and other fuels, and interruptions in supplies of these commodities; changes in exchange rates or interest rates; our ability to accurately forecast our future capital investment needs; increases in our expenses or funding obligations relating to employee health, retiree health and/or pension benefits; our ability to manage insurance and claims expenses; changes in business strategy, government regulations or economic or market conditions that may result in impairments of our assets; potential additional U.S. or international tax liabilities; increasingly stringent regulations related to climate change; potential claims or litigation related to labor and employment, personal injury, property damage, business practices, environmental liability and other matters; and other risks discussed in our filings with the Securities and Exchange Commission from time to time, including our Annual Report on Form 10-K for the year ended December 31, 2023, and subsequently filed reports. You should consider the limitations on, and risks associated with, forward-looking statements and not unduly rely on the accuracy of predictions contained in such forward-looking statements. We do not undertake any obligation to update forward-looking statements to reflect events, circumstances, changes in expectations, or the occurrence of unanticipated events after the date of those statements, except as required by law.
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.
1

Table of Contents
Item 1. Financial Statements
UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
March 31, 2024 (unaudited) and December 31, 2023 (in millions)
March 31,
2024
December 31,
2023
ASSETS
Current Assets:
Cash and cash equivalents$4,281 $3,206 
Marketable securities232 2,866 
Accounts receivable9,698 11,342 
Less: Allowance for credit losses(144)(126)
Accounts receivable, net 9,554 11,216 
Materials and supplies898 935 
Other current assets1,212 1,190 
Total Current Assets16,177 19,413 
Property, Plant and Equipment, Net37,168 36,945 
Operating Lease Right-Of-Use Assets4,223 4,308 
Goodwill4,846 4,872 
Intangible Assets, Net3,308 3,305 
Deferred Income Tax Assets126 126 
Other Non-Current Assets1,780 1,888 
Total Assets$67,628 $70,857 
LIABILITIES AND SHAREOWNERS’ EQUITY
Current Liabilities:
Current maturities of long-term debt, commercial paper and finance leases$1,164 $3,348 
Current maturities of operating leases694 709 
Accounts payable5,397 6,340 
Accrued wages and withholdings3,217 3,224 
Self-insurance reserves1,325 1,320 
Accrued group welfare and retirement plan contributions1,573 1,479 
Other current liabilities1,326 1,256 
Total Current Liabilities14,696 17,676 
Long-Term Debt and Finance Leases18,849 18,916 
Non-Current Operating Leases3,690 3,756 
Pension and Postretirement Benefit Obligations6,323 6,159 
Deferred Income Tax Liabilities3,825 3,772 
Other Non-Current Liabilities3,312 3,264 
Shareowners’ Equity:
Class A common stock (126 and 127 shares issued in 2024 and 2023, respectively)
2 2 
Class B common stock (729 and 726 shares issued in 2024 and 2023, respectively)
7 7 
Additional paid-in capital  
Retained earnings20,681 21,055 
Accumulated other comprehensive loss(3,781)(3,758)
Deferred compensation obligations6 9 
Less: Treasury stock (0.1 and 0.2 shares in 2024 and 2023, respectively)
(6)(9)
Total Equity for Controlling Interests16,909 17,306 
Noncontrolling interests24 8 
Total Shareowners’ Equity16,933 17,314 
Total Liabilities and Shareowners’ Equity$67,628 $70,857 
See notes to unaudited, consolidated financial statements.
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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME
(In millions, except per share amounts)
(unaudited)
 
 Three Months Ended
 March 31,
20242023
Revenue$21,706 $22,925 
Operating Expenses:
Compensation and benefits11,639 11,464 
Repairs and maintenance718 725 
Depreciation and amortization898 834 
Purchased transportation3,246 3,541 
Fuel1,060 1,271 
Other occupancy564 551 
Other expenses1,968 1,998 
Total Operating Expenses20,093 20,384 
Operating Profit1,613 2,541 
Other Income (Expense):
Investment income and other118 169 
Interest expense(195)(188)
Total Other Income (Expense)
(77)(19)
Income Before Income Taxes1,536 2,522 
Income Tax Expense423 627 
Net Income$1,113 $1,895 
Basic Earnings Per Share$1.30 $2.20 
Diluted Earnings Per Share$1.30 $2.19 

STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (LOSS)
(In millions)
(unaudited)
 
 Three Months Ended
 March 31,
 20242023
Net Income$1,113 $1,895 
Change in foreign currency translation adjustment, net of tax(125)118 
Change in unrealized gain (loss) on marketable securities, net of tax(1)7 
Change in unrealized gain (loss) on cash flow hedges, net of tax73 (77)
Change in unrecognized pension and postretirement benefit costs, net of tax30 20 
Comprehensive Income
$1,090 $1,963 
                
See notes to unaudited, consolidated financial statements.
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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
(In millions)
(unaudited)
 Three Months Ended
 March 31,
 20242023
Cash Flows From Operating Activities:
Net income$1,113 $1,895 
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization898 834 
Pension and postretirement benefit expense
259 243 
Pension and postretirement benefit contributions(50)(1,277)
Self-insurance reserves27 (20)
Deferred tax (benefit) expense22 56 
Stock compensation expense(27)126 
Other (gains) losses129 (13)
Changes in assets and liabilities, net of effects of business acquisitions:
Accounts receivable1,492 2,254 
Other assets55 62 
Accounts payable(799)(1,668)
Accrued wages and withholdings12 (508)
Other liabilities185 405 
Other operating activities (32)
Net cash from operating activities3,316 2,357 
Cash Flows From Investing Activities:
Capital expenditures(1,035)(609)
Proceeds from disposal of businesses, property, plant and equipment13 5 
Purchases of marketable securities(50)(2,371)
Sales and maturities of marketable securities2,696 1,179 
Acquisitions, net of cash acquired(44)(34)
Other investing activities(14)17 
Net cash (used in) from investing activities
1,566 (1,813)
Cash Flows From Financing Activities:
Net change in short-term debt(1,272) 
Proceeds from long-term borrowings 2,503 
Repayments of long-term borrowings(926)(65)
Purchases of common stock (751)
Issuances of common stock54 49 
Dividends(1,348)(1,348)
Other financing activities(174)(384)
Net cash (used in) from financing activities
(3,666)4 
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash(48)40 
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash1,168 588 
Cash, Cash Equivalents and Restricted Cash:
Beginning of period3,206 5,602 
End of period$4,374 $6,190 
                
See notes to unaudited, consolidated financial statements.
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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. BASIS OF PRESENTATION AND ACCOUNTING POLICIES
Principles of Consolidation
The accompanying unaudited, consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. These unaudited, consolidated financial statements contain all adjustments (consisting of normal recurring accruals) necessary to present fairly our financial position as of March 31, 2024 and our results of operations and cash flows for the three months ended March 31, 2024 and 2023. The results reported in these unaudited, consolidated financial statements should not be regarded as indicative of results that may be expected for any other period or the entire year. The unaudited, consolidated financial statements should be read in conjunction with the audited, consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2023.
Fair Value of Financial Instruments
The carrying amounts of our cash and cash equivalents, accounts receivable, finance receivables and accounts payable approximated fair value as of March 31, 2024 and December 31, 2023. The fair values of our marketable securities are disclosed in note 5, our recognized multiemployer pension withdrawal liabilities in note 7, our short- and long-term debt in note 9 and our derivative instruments in note 15. We apply a fair value hierarchy (Levels 1, 2 and 3) when measuring and reporting items at fair value. Fair values are based on listed market prices (Level 1), when such prices are available. To the extent that listed market prices are not available, fair value is determined based on other relevant factors, including dealer price quotations (Level 2). If listed market prices or other relevant factors are not available, inputs are developed from unobservable data reflecting our own assumptions and include situations where there is little or no market activity for the asset or liability (Level 3).
Use of Estimates
The preparation of the accompanying unaudited, consolidated financial statements requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingencies at the date of these financial statements, as well as the reported amounts of revenues and expenses during the reporting period.
Although our estimates contemplate current and expected future conditions, as applicable, it is reasonably possible that actual conditions could differ from our expectations, which could materially affect our results of operations and financial position. As a result, our accounting estimates and assumptions may change significantly over time.
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. We have been informed by the participating financial institutions that as of March 31, 2024 and December 31, 2023, suppliers sold them $406 and $504 million, respectively, of our outstanding payment obligations.
Restricted cash
As of March 31, 2024 and December 31, 2023, we had $93 and $37 million, respectively of restricted cash. As of March 31, 2024, this restricted cash is included in Other Non-Current Assets in our consolidated balance sheet and is included in Total cash, cash equivalents and restricted cash in our statement of consolidated cash flows. The restricted cash primarily relates to cash we have agreed to deposit in connection with a challenge by Italian tax authorities to the deductibility of Value Added Tax payments by UPS to certain third-party service providers, a review of which was launched in the fourth quarter of 2023. We are cooperating in this matter and believe that we have a number of meritorious defenses.
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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2. RECENT ACCOUNTING PRONOUNCEMENTS
Adoption of New Accounting Standards
Accounting pronouncements adopted during the periods covered by the unaudited, consolidated financial statements did not have a material impact on our consolidated financial position, results of operations, cash flows or internal controls.
Accounting Standards Issued But Not Yet Effective
In November 2023, the Financial Accounting Standards Board ("FASB") issued an Accounting Standards Update ("ASU") on segment reporting, which will require new disclosures, including significant segment expenses and additional qualitative information about how segment measures are used by management. The standard becomes effective for us beginning with our 2024 annual reporting and for both annual and interim periods thereafter. We are evaluating the impact of this ASU on our disclosures. We will be required to define significant segment expense categories and we anticipate providing additional qualitative information in accordance with this ASU. We do not expect this ASU will have a significant impact on our consolidated financial position, results of operations or cash flows.
In December 2023, the FASB issued an ASU to enhance tax-related disclosures. This update will require more standardized categories for tax rate reconciliation and additional detail for significant tax items. It will also require a breakdown of income taxes paid by jurisdiction exceeding 5% of total taxes and remove certain disclosure requirements for unremitted foreign earnings and uncertain tax positions. The standard becomes effective for us in the first quarter of 2025. We are evaluating its impact on our financial statements, disclosures and internal controls but do not expect this ASU will have a significant impact on our consolidated financial position, results of operations, cash flows or internal controls.
Other accounting pronouncements issued before, but not effective until after, March 31, 2024, are not expected to have a material impact on our consolidated financial position, results of operations, cash flows or internal controls.
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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3. REVENUE RECOGNITION
Revenue Recognition
Substantially all of our revenues are from contracts associated with the pickup, transportation and delivery of packages and freight ("transportation services"). These services may be carried out by or arranged by us and generally occur over a short period of time. Additionally, we provide value-added logistics services to customers through our global network of distribution centers and field stocking locations.
The vast majority of our contracts with customers are for transportation services that include only one performance obligation; the transportation services themselves. We generally recognize revenue over time, based on the extent of progress towards completion of the services in the contract. All of our major businesses act as a principal in their revenue arrangements and as such, we report revenue and the associated purchased transportation costs on a gross basis within our statements of consolidated income.
Disaggregation of Revenue
Three Months Ended
 March 31,
20242023
Revenue:
Next Day Air$2,316 $2,461 
Deferred 1,156 1,194 
Ground10,762 11,332 
     U.S. Domestic Package14,234 14,987 
Domestic758 794 
Export3,350 3,552 
Cargo & Other148 197 
    International Package4,256 4,543 
Forwarding1,280 1,514 
Logistics1,542 1,410 
Other394 471 
    Supply Chain Solutions3,216 3,395 
Consolidated revenue$21,706 $22,925 
Contract Assets and Liabilities
Contract assets include billed and unbilled amounts resulting from in-transit shipments, as we have an unconditional right to payment only when services have been completed (i.e. shipments have been delivered). Amounts do not exceed their net realizable value. Contract assets are generally classified as current and the full balance is converted each quarter based on the short-term nature of the transactions.
Contract liabilities consist of advance payments and billings in excess of revenue as well as deferred revenue. Advance payments and billings in excess of revenue represent payments received from our customers that will be earned over the contract term. Deferred revenue represents the amount due from customers related to in-transit shipments that has not yet been recognized as revenue based on our selected measure of progress. We classify advance payments and billings in excess of revenue as either current or long-term, depending on the period over which the amount will be earned. We classify deferred revenue as current based on the short-term nature of the transactions. Our contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period. In order to determine revenue recognized in the period from contract liabilities, we first allocate revenue to the individual contract liability balance outstanding at the beginning of the period until the revenue exceeds that deferred revenue balance.
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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Contract assets and liabilities as of March 31, 2024 and December 31, 2023 were as follows (in millions):
Balance Sheet Location
March 31, 2024
December 31, 2023
Contract Assets:
Revenue related to in-transit packagesOther current assets$269 $237 
Contract Liabilities:
Short-term advance payments from customersOther current liabilities$13 $20 
Long-term advance payments from customersOther non-current liabilities$26 $25 
Accounts Receivable, Net
Accounts receivable, net, include amounts billed and currently due from customers. The amounts due are stated at their net estimated realizable value. Losses on accounts receivable are recognized when reasonable and supportable forecasts affect the expected collectability. This requires us to make our best estimate of the current expected losses inherent in our accounts receivable at each balance sheet date. This estimate requires consideration of historical loss experience, adjusted for current conditions, forward looking indicators, trends in customer payment frequency and judgments about the probable effects of relevant observable data, including present and future economic conditions and the financial health of specific customers and market sectors. Our risk management process includes standards and policies for reviewing major account exposures and concentrations of risk.
Our allowance for credit losses as of March 31, 2024 and December 31, 2023 was $144 and $126 million, respectively. Amounts for credit losses charged to expense, before recoveries, during each of the three months ended March 31, 2024 and 2023 were $73 and $43 million, respectively.


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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4. STOCK-BASED COMPENSATION
We issue share-based awards under various incentive compensation plans, including non-qualified and incentive stock options, stock appreciation rights, restricted stock and stock units ("RSUs") and restricted performance shares and performance units ("RPUs", collectively with RSUs, "Restricted Units"). Upon vesting, Restricted Units result in the issuance of the equivalent number of UPS class A common shares after required tax withholdings. Dividends earned on Restricted Units are reinvested in additional Restricted Units at each dividend payable date until conversion to class A shares occurs.
Our primary equity compensation programs are the UPS Long-Term Incentive Performance Award program (the "LTIP") and the UPS Stock Option program. We also grant Restricted Units to our Board of Directors (the "Board") as a component of their annual compensation and, from time to time, to individual employees as a retention mechanism. We also maintain an employee stock purchase plan which allows eligible employees to purchase shares of UPS class A common stock at a discount.
Pre-tax compensation expense for stock compensation awards recognized in Compensation and benefits in the statements of consolidated income for the three months ended March 31, 2024 and 2023 was $(27) and $126 million, respectively.
Management Incentive Award Program
The UPS Management Incentive Program (the "MIP") is an incentive-based compensation program, with awards based on annual Company performance. MIP awards are paid in cash, unless a participant elects to receive all or a portion of the award in unrestricted shares of class A common stock. As of March 31, 2024, the MIP was classified as a compensation obligation within Accrued wages and withholdings in our consolidated balance sheet.
Long-Term Incentive Performance Program
RPUs issued under the LTIP vest at the end of a three-year performance period, subject to continued employment with the Company (except in the case of death, disability or retirement, in which case immediate vesting occurs on a prorated basis). The actual number of RPUs earned is based on achievement of the performance targets established on the grant date.
The performance targets are equally weighted between adjusted earnings per share and cumulative free cash flow. The final number of RPUs earned will then be subject to adjustment based on total shareholder return relative to the Standard & Poor's 500 Index. We determine the grant date fair value of the RPUs using a Monte Carlo model and recognize compensation expense (less estimated forfeitures) ratably over the vesting period, based on the number of awards expected to be earned.
Based on the date of the Compensation and Human Capital Committee of the Board's approval of the 2024 LTIP award performance targets, we determined March 20, 2024 to be the award measurement date and each target RPU awarded was valued at $158.16.
The weighted-average assumptions used and the weighted-average fair values of the LTIP awards granted in 2024 and 2023 are as follows:
20242023
Risk-free interest rate4.45 %3.81 %
Expected volatility27.00 %30.30 %
Weighted-average fair value of units granted
$158.16 $200.01 
Share payout102.20 %107.80 %
There is no expected dividend yield as units earn dividend equivalents.

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Non-Qualified Stock Options
We grant non-qualified stock options to a limited group of eligible senior management employees under the UPS Stock Option program. Stock option awards vest over a five-year period with approximately 20% of the award vesting at each anniversary of the grant date (except in the case of death, disability or retirement, in which case immediate vesting occurs). The option grants expire 10 years after the date of the grant. On March 20, 2024, we granted 0.2 million stock options at an exercise price of $154.76, the New York Stock Exchange closing price on that date.
The fair value of each option granted is estimated using a Black-Scholes option pricing model. The weighted-average assumptions used and the weighted-average fair values of options granted in 2024 and 2023 are as follows:
20242023
Expected dividend yield3.96 %3.54 %
Risk-free interest rate4.25 %3.70 %
Expected life (in years)6.135.93
Expected volatility28.94 %28.31 %
Weighted-average fair value of options granted
$34.76 $41.08 
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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5. MARKETABLE SECURITIES AND NON-CURRENT INVESTMENTS
The following is a summary of marketable securities classified as trading and available for sale as of March 31, 2024 and December 31, 2023 (in millions):
CostUnrealized
Gains
Unrealized
Losses
Estimated
Fair Value
March 31, 2024:
Current trading marketable securities:
Equity securities$3 $— $— $3 
Total trading marketable securities3 — — 3 
Current available-for-sale securities:
U.S. government and agency debt securities200  (2)198 
Mortgage and asset-backed debt securities    
Corporate debt securities32  (1)31 
Non-U.S. government debt securities    
Total available-for-sale marketable securities232  (3)229 
Total current marketable securities$235 $ $(3)$232 
 CostUnrealized
Gains
Unrealized
Losses
Estimated
Fair Value
December 31, 2023:
Current trading marketable securities:
Equity securities$4 $— $— $4 
Total trading marketable securities4 — — 4 
Current available-for-sale securities:
U.S. government and agency debt securities963 2 (4)961 
Mortgage and asset-backed debt securities3   3 
Corporate debt securities1,891 4 (4)1,891 
Non-U.S. government debt securities7   7 
Total available-for-sale marketable securities2,864 6 (8)2,862 
Total current marketable securities$2,868 $6 $(8)$2,866 
Investment Impairments
We have concluded that no material impairment losses existed within marketable securities as of March 31, 2024. In making this determination, we considered the financial condition and prospects of each issuer, the magnitude of the losses compared with the cost, the probability that we will be unable to collect all amounts due according to the contractual terms of the security, the credit rating of the security and our ability and intent to hold these investments until the anticipated recovery in market value occurs.
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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Maturity Information
The amortized cost and estimated fair value of marketable securities as of March 31, 2024 by contractual maturity are shown below (in millions). Actual maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations with or without prepayment penalties.
CostEstimated
Fair Value
Due in one year or less$70 $69 
Due after one year through three years162 160 
Due after three years through five years  
Due after five years  
232 229 
Equity securities3 3 
$235 $232 
Non-Current Investments
We hold non-current investments that are reported within Other Non-Current Assets in our consolidated balance sheets. Cash paid for these investments is included in Other investing activities in our statements of consolidated cash flows.
Equity method investments: As of March 31, 2024 and December 31, 2023, equity securities accounted for under the equity method had a carrying value of $293 and $295 million, respectively.
Other equity securities: Certain equity securities that do not have readily determinable fair values are reported in accordance with the measurement alternative in ASC Topic 321 Investments - Equity Securities. Equity securities accounted for under the measurement alternative had a carrying value of $47 million as of both March 31, 2024 and December 31, 2023.
Other investments: We hold an investment in a variable life insurance policy to fund benefits for the UPS Excess Coordinating Benefit Plan. The investment had a fair market value of $19 million as of both March 31, 2024 and December 31, 2023.













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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Fair Value Measurements
Marketable securities valued utilizing Level 1 inputs include active exchange-traded equity securities and equity index funds, and most U.S. government debt securities, as these securities all have quoted prices in active markets. Marketable securities valued utilizing Level 2 inputs include asset-backed securities, corporate bonds and municipal bonds. These securities are valued using market corroborated pricing, matrix pricing or other models that utilize observable inputs such as yield curves.
The following table presents information about our investments measured at fair value on a recurring basis as of March 31, 2024 and December 31, 2023, and indicates the fair value hierarchy of the valuation techniques utilized to determine such fair value (in millions):
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
Significant Other
Observable Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Total 
March 31, 2024:
Marketable Securities:
U.S. government and agency debt securities$198 $ $ $198 
Mortgage and asset-backed debt securities    
Corporate debt securities 31  31 
Equity securities 3  3 
Non-U.S. government debt securities    
Total marketable securities198 34  232 
Other non-current investments(1)
 19  19 
Total$198 $53 $ $251 
(1)    Represents a variable life insurance policy funding benefits for the UPS Excess Coordinating Benefit Plan.

Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
Significant Other
Observable Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
Total
December 31, 2023:
Marketable Securities:
U.S. government and agency debt securities$961 $ $ $961 
Mortgage and asset-backed debt securities 3  3 
Corporate debt securities 1,891  1,891 
Equity securities 4  4 
Non-U.S. government debt securities 7  7 
Total marketable securities961 1,905  2,866 
Other non-current investments(1)
 19  19 
Total$961 $1,924 $ $2,885 
(1)    Represents a variable life insurance policy funding benefits for the UPS Excess Coordinating Benefit Plan.
There were no transfers of investments into or out of Level 3 during the three months ended March 31, 2024 or 2023.

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 6. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment as of March 31, 2024 and December 31, 2023 consisted of the following (in millions):
20242023
Vehicles$11,970 $11,768 
Aircraft23,117 22,888 
Land2,129 2,138 
Buildings6,282 6,255 
Building and leasehold improvements5,295 5,241 
Plant equipment18,109 17,322 
Technology equipment2,677 2,656 
Construction-in-progress2,634 3,247 
72,213 71,515 
Less: Accumulated depreciation and amortization(35,045)(34,570)
Property, Plant and Equipment, Net$37,168 $36,945 
Property, plant and equipment purchased on account was $204 and $309 million as of March 31, 2024 and December 31, 2023, respectively. 
There were no material impairment charges for the three months ended March 31, 2024 or 2023.

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7. EMPLOYEE BENEFIT PLANS
Company-Sponsored Benefit Plans
Information about the net periodic benefit cost for our company-sponsored pension and postretirement benefit plans for the three months ended March 31, 2024 and 2023 is as follows (in millions):
 U.S. Pension BenefitsU.S. Postretirement
Medical Benefits
International
Pension Benefits
202420232024202320242023
Three Months Ended March 31:
Service cost$310 $293 $5 $5 $11 $11 
Interest cost644 627 27 29 17 17 
Expected return on assets(771)(742)(1)(3)(21)(21)
Amortization of prior service cost38 27     
Net periodic benefit cost
$221 $205 $31 $31 $7 $7 
The components of net periodic benefit cost other than current service cost are presented within Investment income and other in the statements of consolidated income.
During the three months ended March 31, 2024, we contributed $19 million and $31 million to our company-sponsored pension and U.S. postretirement medical benefit plans, respectively. We expect to contribute approximately $87 million over the remainder of the year to our U.S. postretirement medical benefit plans.
Multiemployer Benefit Plans
We contribute to a number of multiemployer defined benefit and health and welfare plans under the terms of collective bargaining agreements that cover our union-represented employees. Our current collective bargaining agreements set forth the annual contribution increases allotted to the plans that we participate in, and we are in compliance with these contribution rates. These limitations on annual contribution rates will remain in effect throughout the terms of the existing collective bargaining agreements.
As of March 31, 2024 and December 31, 2023, we had $811 and $813 million, respectively, recorded in Other Non-Current Liabilities in our consolidated balance sheets and $9 million as of both March 31, 2024 and December 31, 2023 recorded in Other current liabilities in our consolidated balance sheets associated with our previous withdrawal from the New England Teamsters and Trucking Industry Pension Fund. This liability is payable in equal monthly installments over a remaining term of approximately 39 years. Based on the borrowing rates currently available to us for long-term financing of a similar maturity, the fair value of this withdrawal liability as of March 31, 2024 and December 31, 2023 was $685 and $710 million, respectively. We utilized Level 2 inputs in the fair value hierarchy of valuation techniques to determine the fair value of this liability.
UPS was a contributing employer to the Central States Pension Fund (“CSPF”) until 2007, at which time UPS withdrew from the CSPF. Under a collective bargaining agreement with the International Brotherhood of Teamsters (“IBT”), UPS agreed to provide coordinating benefits in the UPS/IBT Full Time Employee Pension Plan (“UPS/IBT Plan”) for UPS participants whose last employer was UPS and who had not retired as of January 1, 2008 (“the UPS Transfer Group”) in the event that benefits are reduced by the CSPF consistent with the terms of our withdrawal agreement with the CSPF. Under this agreement, benefits to the UPS Transfer Group cannot be reduced without our consent and can only be reduced in accordance with law.
Subsequent to our withdrawal, the CSPF incurred extensive asset losses and indicated that it was projected to become insolvent. In such event, the CSPF benefits would be reduced to the legally permitted Pension Benefit Guaranty Corporation ("PBGC") limits, triggering the coordinating benefits provision in the collective bargaining agreement.
In 2021, the American Rescue Plan Act ("ARPA") was enacted into law. The ARPA contains provisions that allow for qualifying multiemployer pension plans to apply for special financial assistance ("SFA") from the PBGC, which will be funded by the U.S. government. Following SFA approval, a qualifying multiemployer pension plan will receive a lump sum payment to enable it to continue paying unreduced pension benefits through 2051. The multiemployer plan is not obligated to repay the SFA. The ARPA is intended to prevent both the PBGC and certain financially distressed multiemployer pension plans, including the CSPF, from becoming insolvent through 2051. The CSPF submitted an application for SFA that was approved in December 2022. In January 2023, $35.8 billion was paid to the CSPF by the PBGC.
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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

We account for the potential obligation to pay coordinating benefits under ASC Topic 715, which requires us to provide a best estimate of various actuarial assumptions in measuring our pension benefit obligation at the December 31 measurement date. As of December 31, 2023, our best estimate of coordinating benefits that may be required to be paid by the UPS/IBT Plan after SFA funds have been exhausted was immaterial.
The value of our estimate for future coordinating benefits will continue to be influenced by a number of factors, including interpretations of the ARPA, future legislative actions, actuarial assumptions and the ability of the CSPF to sustain its long-term commitments. Actual events may result in a change in our best estimate of the projected benefit obligation. We will continue to assess the impact of these uncertainties in accordance with ASC Topic 715.
Collective Bargaining Agreements
We have approximately 310,000 employees in the U.S. employed under a national master agreement and various supplemental agreements with local unions affiliated with the Teamsters. These agreements are scheduled to expire on July 31, 2028.
We have approximately 10,000 employees in Canada employed under a collective bargaining agreement with the Teamsters which runs through July 31, 2025.
We have approximately 3,300 pilots who are employed under a collective bargaining agreement with the Independent Pilots Association. This collective bargaining agreement becomes amendable September 1, 2025.
We have approximately 1,900 airline mechanics who are covered by a collective bargaining agreement with Teamsters Local 2727 which becomes amendable November 1, 2026. In addition, approximately 3,000 of our auto and maintenance mechanics who are not employed under agreements with the Teamsters are employed under collective bargaining agreements with the International Association of Machinists and Aerospace Workers. These collective bargaining agreements run through July 31, 2024.
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NOTE 8. GOODWILL AND INTANGIBLE ASSETS
The following table indicates the allocation of goodwill as of March 31, 2024 and December 31, 2023 (in millions):
U.S. Domestic
Package
International
Package
Supply Chain SolutionsConsolidated
December 31, 2023:$847 $503 $3,522 $4,872 
Acquired  8 8 
Currency / Other (7)(27)(34)
March 31, 2024:$847 $496 $3,503 $4,846 
Changes in goodwill during the three months ended March 31, 2024 resulted from:
An increase in goodwill of $8 million, as part of purchase accounting allocations relating to our acquisitions of MNX Global Logistics and Happy Returns in the fourth quarter of 2023. Certain areas of purchase accounting, including our estimates of tax positions, remain preliminary as of March 31, 2024.
The remaining movements are due to the impact of changes in the value of the U.S. Dollar on the translation of non-U.S. Dollar goodwill balances.
As of March 31, 2024, none of our reporting units had indications that an impairment was more likely than not. Approximately $1.5 billion of our consolidated goodwill balance of $4.8 billion is represented by our Global Freight Forwarding, our truckload brokerage ("Coyote") and Roadie reporting units which, based on our quarterly monitoring, are exhibiting a limited excess of fair value above carrying value and reflect a greater risk of an impairment occurring in future periods. We do not expect any impairment would have a significant impact on our consolidated financial position, results of operations or cash flows.
Actual reporting unit performance, revisions to our forecasts of future performance, market factors, changes in estimates or assumptions in connection with our annual testing, or a combination thereof could result in an impairment charge in one or more of our reporting units during a future period. We continue to monitor business performance and external factors affecting our reporting units.

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The following is a summary of intangible assets as of March 31, 2024 and December 31, 2023 (in millions):
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Value
March 31, 2024:
Capitalized software$5,923 $(4,007)$1,916 
Licenses45 (13)32 
Franchise rights332 (48)284 
Customer relationships1,114 (537)577 
Trade name112 (19)93 
Trademarks, patents and other377 (64)313 
Amortizable intangible assets$7,903 $(4,688)$3,215 
Indefinite-lived intangible assets93 — 93 
Total Intangible Assets, Net$7,996 $(4,688)$3,308 
December 31, 2023:
Capitalized software$5,839 $(3,900)$1,939 
Licenses30 (7)23 
Franchise rights291 (49)242 
Customer relationships1,115 (516)599 
Trade name172 (30)142 
Trademarks, patents and other320 (53)267 
Amortizable intangible assets$7,767 $(4,555)$3,212 
Indefinite-lived intangible assets93 — 93 
Total Intangible Assets, Net$7,860 $(4,555)$3,305 
A trade name and licenses with carrying values of $89 and $4 million, respectively, as of March 31, 2024 are deemed to be indefinite-lived intangible assets, and therefore are not amortized.
As of March 31, 2024, the estimated fair value of the indefinite-lived trade name associated with Coyote remained greater than its carrying value by less than 10 percent. The carrying value of this trade name is $89 million. Our truckload brokerage business continues to be negatively impacted by market conditions, which has resulted in revenue declines. We continue to monitor business performance and external factors affecting our valuation assumptions for this trade name. There were no events or changes in circumstances as of March 31, 2024 that would indicate the carrying amounts of our indefinite-lived intangible assets may be impaired as of the date of this report.
For the three months ended March 31, 2024, we recorded impairment charges related to finite-lived intangible assets of $48 million ($35 million after tax, or $0.04 per diluted share) within Other Expenses in our statement of consolidated income. These charges represented capitalized software license impairments of $7 million and a $41 million charge to write down the value of certain trade names acquired as part of our acquisition of Bomi Group as we consolidate our brands. There were no impairment charges for finite-lived intangible assets for the three months ended March 31, 2023.
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NOTE 9. DEBT AND FINANCING ARRANGEMENTS
The carrying value of our outstanding debt obligations as of March 31, 2024 and December 31, 2023 consisted of the following (in millions):
Principal
Amount
Carrying Value
Maturity20242023
Commercial paper$ $ $2,172 
Fixed-rate senior notes:
2.800% senior notes
500 2024500 499 
2.200% senior notes
400 2024400 400 
3.900% senior notes
1,000 2025999 999 
2.400% senior notes
500 2026499 499 
3.050% senior notes
1,000 2027996 996 
3.400% senior notes
750 2029747 747 
2.500% senior notes
400 2029398 398 
4.450% senior notes
750 2030745 745 
4.875% senior notes
900 2033895 894 
6.200% senior notes
1,500 20381,485 1,485 
5.200% senior notes
500 2040494 494 
4.875% senior notes
500 2040491 491 
3.625% senior notes
375 2042369 369 
3.400% senior notes
500 2046492 492 
3.750% senior notes
1,150 20471,138 1,138 
4.250% senior notes
750 2049743 743 
3.400% senior notes
700 2049689 689 
5.300% senior notes
1,250 20501,232 1,232 
5.050% senior notes
1,100 20531,083 1,083 
Floating-rate senior notes:
Floating-rate senior notes1,562 2049-20731,544 1,545 
Debentures:
7.620% debentures
276 2030280 280 
Pound Sterling notes:
5.500% notes
84 203183 84 
5.125% notes
574 2050546 550 
Euro senior notes:
1.625% senior notes
755 2025754 774 
1.000% senior notes
539 2028537 551 
1.500% senior notes
539 2032537 551 
Canadian senior notes:
2.125% senior notes
554 2024554 566 
Finance lease obligations (see note 10)
460 2024-2046460 472 
Facility notes and bonds320 2029-2045320 320 
Other debt3 2024-20253 6 
Total debt$20,191 20,013 22,264 
Less: current maturities(1,164)(3,348)
Long-term debt$18,849 $18,916 

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Commercial Paper
We are authorized to borrow up to $10.0 billion under a U.S. commercial paper program and €5.0 billion (in a variety of currencies) under a European commercial paper program. There was no commercial paper outstanding as of March 31, 2024. The amount of commercial paper outstanding under these programs in 2024 is expected to fluctuate.
Debt Classification
We have classified certain floating-rate senior notes that are redeemable at the option of the note holder as long-term debt in our consolidated balance sheets, due to our intent and ability to refinance the debt if the put option is exercised. As of March 31, 2024, we continued to classify our 2.200% senior notes with a principal balance of $400 million that mature in September 2024 as long-term debt in our consolidated balance sheet due to our intent and ability to refinance the debt.
Sources of Credit
We maintain two credit agreements with a consortium of banks. The first of these agreements provides revolving credit facilities of $1.0 billion, and expires on December 3, 2024. Amounts outstanding under this agreement bear interest at a periodic fixed rate equal to the term SOFR rate, plus 0.10% per annum and an applicable margin based on our then-current credit rating. The applicable margin from the credit pricing grid as of March 31, 2024 was 0.70%. Alternatively, a fluctuating rate of interest equal to the highest of (1) the rate of interest last quoted by The Wall Street Journal as the prime rate in the United States; (2) the Federal Funds effective rate plus 0.50%; or (3) the Adjusted Term SOFR Rate for a one-month interest period plus 1.00%, may be used at our discretion.
The second agreement provides revolving credit facilities of $2.0 billion, and expires on December 7, 2026. Amounts outstanding under this facility bear interest at a periodic fixed rate equal to the term SOFR rate plus 0.10% per annum and an applicable margin based on our then-current credit rating. The applicable margin from the credit pricing grid as of March 31, 2024 was 0.875%. Alternatively, a fluctuating rate of interest equal to the highest of (1) the rate of interest last quoted by The Wall Street Journal as the prime rate in the United States; (2) the Federal Funds effective rate plus 0.50%; or (3) the Adjusted Term SOFR Rate for a one-month interest period plus 1.00%, plus an applicable margin, may be used at our discretion.
If the credit ratings established by Standard & Poor's and Moody's differ, the higher rating will be used, except in cases where the lower rating is two or more levels lower. In these circumstances, the rating one step below the higher rating will be used. We are also able to request advances under these facilities based on competitive bids for the applicable interest rate.
There were no amounts outstanding under these facilities as of March 31, 2024.
Debt Covenants
Our existing debt instruments and credit facilities subject us to certain financial covenants. As of March 31, 2024, and for all prior periods presented, we have satisfied these financial covenants. These covenants limit the amount of secured indebtedness that we may incur, and limit the amount of attributable debt in sale-leaseback transactions, to 10% of net tangible assets. As of March 31, 2024, 10% of net tangible assets was equivalent to $4.5 billion and we had no covered sale-leaseback transactions or secured indebtedness outstanding. We do not expect these covenants to have a material impact on our liquidity.
Fair Value of Debt    
Based on the borrowing rates currently available to us for long-term debt with similar terms and maturities, the fair value of long-term debt, including current maturities, was approximately $19.4 and $22.1 billion as of March 31, 2024 and December 31, 2023, respectively. We utilized Level 2 inputs in the fair value hierarchy of valuation techniques to determine the fair value of all of our debt instruments.
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NOTE 10. LEASES
We have finance and operating leases for real estate (primarily package centers, airport facilities and warehouses), aircraft and engines, information technology equipment, vehicles and various other equipment used in operating our business. Certain leases for real estate and aircraft contain options to purchase, extend or terminate the lease.
Aircraft
In addition to the aircraft that we own, we charter aircraft to handle package and cargo volume on certain international trade lanes and domestic routes. Due to the nature of these agreements, primarily being that either party can cancel the agreement with short notice, we have classified these as short-term leases. A majority of our long-term aircraft operating leases are operated by a third party to handle package and cargo volume in geographic regions where, due to government regulations, we are restricted from operating an airline.
Transportation equipment and other equipment
We enter into both long-term and short-term leases for transportation equipment to supplement our capacity or meet contractual demands. Some of these assets are leased on a month-to-month basis and the leases can be terminated without penalty. We also enter into equipment leases to increase capacity during periods of high demand. These leases are treated as short-term as the cumulative right of use is less than 12 months over the term of the contract.
Some of our transportation and technology equipment leases require us to make additional lease payments based on the underlying usage of the assets. Due to the variable nature of these costs, these are expensed as incurred and are not included in the right of use lease asset and associated lease obligation.
The components of lease expense for the three months ended March 31, 2024 and 2023 were as follows (in millions):
20242023
Operating lease costs$231 $207 
Finance lease costs:
Amortization of assets35 29 
Interest on lease liabilities5 4 
Total finance lease costs40 33 
Variable lease costs76 72 
Short-term lease costs199 277 
Total lease costs(1)
$546 $589 
(1) This table excludes sublease income as it was not material for the three months ended March 31, 2024 or 2023.
In addition to the lease costs disclosed in the table above, we monitor all lease categories for any indicators that the carrying value of the assets may not be recoverable. There were no material lease impairments recognized during the three months ended March 31, 2024 or 2023.
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Supplemental information related to leases and location within our consolidated balance sheets is as follows (in millions, except lease term and discount rate):
March 31,
2024
December 31,
2023
Operating Leases:
Operating lease right-of-use assets$4,223 $4,308 
Current maturities of operating leases$694 $709 
Non-current operating leases3,690 3,756 
Total operating lease obligations$4,384 $4,465 
Finance Leases:
Property, plant and equipment, net$727 $856 
Current maturities of long-term debt, commercial paper and finance leases$108 $104 
Long-term debt and finance leases352 368 
Total finance lease obligations$460 $472 
Weighted average remaining lease term (in years):
Operating leases10.710.8
Finance leases7.27.4
Weighted average discount rate:
Operating leases3.30 %3.20 %
Finance leases3.91 %3.88 %

Supplemental cash flow information related to leases is as follows (in millions):
Three Months Ended
 March 31,
20242023
Cash paid for amounts included in measurement of obligations:
Operating cash flows from operating leases$227 $212 
Operating cash flows from finance leases3 1 
Financing cash flows from finance leases26 48 
Right-of-use assets obtained in exchange for lease obligations:
Operating leases$151 $498 
Finance leases$14 $30 

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Maturities of lease obligations as of March 31, 2024 were as follows (in millions):
Finance LeasesOperating Leases
2024$101 $609 
2025102 807 
202677 697 
202747 596 
202841 449 
Thereafter173 2,102 
Total lease payments541 5,260 
Less: Imputed interest(81)(876)
Total lease obligations460 4,384 
Less: Current obligations(108)(694)
Long-term lease obligations$352 $3,690 
As of March 31, 2024, we had $720 million of additional leases which had not commenced. These leases will commence later in 2024 or in 2025 when we are granted access to the property, such as when leasehold improvements are completed by the lessor or a certificate of occupancy is obtained.
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NOTE 11. LEGAL PROCEEDINGS AND CONTINGENCIES
We are involved in a number of judicial proceedings and other matters arising from the conduct of our business.
Although there can be no assurances as to the ultimate outcome, we have generally denied, or believe we have meritorious defenses and will deny, liability in pending matters, including (except as may be otherwise noted herein) the matters described below, and we intend to vigorously defend each matter. We accrue amounts associated with judicial proceedings and other contingencies when and to the extent a loss becomes probable and can be reasonably estimated. The actual costs of resolving legal proceedings may be substantially higher or lower than the amounts accrued on those claims.
For matters as to which we are not able to estimate a possible loss or range of losses, we are not able to determine whether any such loss will have a material impact on our operations or financial condition. For these matters, we have described the reasons that we are unable to estimate a possible loss or range of losses.
Judicial Proceedings
We are a defendant in a number of lawsuits filed in state and federal courts containing various class action allegations under state wage-and-hour laws. We do not believe that any loss associated with any such matter will have a material impact on our financial condition, results of operations or liquidity.
In July 2023, Baker v. United Parcel Service, Inc. (DE) and United Parcel Service, Inc. (OH) was certified as a class action in federal court in the Eastern District of Washington. The plaintiff in this matter alleges that UPS violated the Uniformed Services Employment and Reemployment Rights Act. We are vigorously defending ourselves in this matter and believe that we have a number of meritorious defenses, and there are unresolved questions of law and fact that could be important to the ultimate resolution of this matter. Accordingly, we are not able to estimate a possible loss or range of loss that may result from this matter or to determine whether such loss, if any, would have a material adverse effect on our financial condition, results of operations or liquidity.
Other Matters
In August 2016, Spain’s National Markets and Competition Commission ("CNMC") announced an investigation into 10 companies in the commercial delivery and parcel industry, including UPS, related to alleged nonaggression agreements to allocate customers. In May 2017, we received a Statement of Objections issued by the CNMC. In July 2017, we received a Proposed Decision from the CNMC. In March 2018, the CNMC adopted a final decision, finding an infringement and imposing an immaterial fine on UPS. We appealed the decision. In December 2022, a trial court ruled against us. We have filed an appeal before the Spanish Supreme Court. We are vigorously defending ourselves and believe that we have a number of meritorious defenses. There are also unresolved questions of law that could be important to the ultimate resolution of this matter. We do not believe that any loss from this matter would have a material impact on our financial condition, results of operations or liquidity.
The Securities and Exchange Commission (the "SEC") has been investigating our controls and practices surrounding impairment analyses in connection with the sale of UPS Freight in April 2021. Such analysis led to a non-cash goodwill impairment charge being recorded during the quarter ended December 31, 2020. Since March 2024, when the SEC staff informed the Company that it disagreed with the timing of the impairment, the Company has been discussing with the SEC staff the possibility of reaching a negotiated resolution. Although the Company cannot predict the ultimate outcome of the investigation with certainty, it believes the resolution of the SEC investigation will not have a material effect on the Company's financial condition, results of operations or liquidity. An accrual representing our best estimate of the impact of this regulatory matter is included in our consolidated balance sheet at March 31, 2024.
We are a party to various other matters that arose in the normal course of business. These include disputes with government authorities in various jurisdictions over the imposition of duties, fines, taxes and assessments from time to time. We are vigorously defending ourselves and believe that we have a number of meritorious defenses in these disputes. There are also unresolved questions of law that could be important to the ultimate resolution of these disputes. Accordingly, we are not able to estimate a possible loss or range of losses that may result from these disputes or to determine whether such losses, if any, would have a material impact on our financial condition, results of operations or liquidity.
We do not believe that the eventual resolution of any other matters (either individually or in the aggregate), including any reasonably possible losses in excess of current accruals, will have a material impact on our operations or financial condition.


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NOTE 12. SHAREOWNERS' EQUITY
Capital Stock, Additional Paid-In Capital, Retained Earnings and Non-Controlling Interests
We are authorized to issue two classes of common stock, which are distinguished from each other primarily by their respective voting rights. Class A shares of UPS are entitled to 10 votes per share, whereas class B shares are entitled to one vote per share. Class A shares are primarily held by UPS employees and retirees, as well as trusts and descendants of the Company's founders, and these shares are fully convertible into class B shares at any time. Class B shares are publicly traded on the New York Stock Exchange under the symbol "UPS". Class A and B shares both have a $0.01 par value, and as of March 31, 2024, there were 4.6 billion class A shares and 5.6 billion class B shares authorized to be issued. Additionally, there are 200 million preferred shares authorized to be issued, with a par value of $0.01 per share. As of March 31, 2024, no preferred shares had been issued.
The following is a rollforward of our common stock, additional paid-in capital, retained earnings and non-controlling interests accounts for the three months ended March 31, 2024 and 2023 (in millions, except per share amounts):
Three Months Ended March 31:20242023
 SharesDollarsSharesDollars
Class A Common Stock:
Balance at beginning of period127 $2 134 $2