Annual report pursuant to Section 13 and 15(d)

SEGMENT AND GEOGRAPHIC INFORMATION

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SEGMENT AND GEOGRAPHIC INFORMATION
 12 Months Ended
Dec. 31, 2024
Segments, Geographical Areas [Abstract]  
SEGMENT AND GEOGRAPHIC INFORMATION
NOTE 14. SEGMENT AND GEOGRAPHIC INFORMATION
We have two reportable segments: U.S. Domestic Package and International Package, which are together referred to as our global small package operations. Our remaining businesses are reported as Supply Chain Solutions. Global small package operations represent our most significant business and are broken down into regional operations around the world. Regional operations managers are responsible for both domestic and export products within their geographic area. Supply Chain Solutions comprises the results of non-reportable operating segments that do not meet the quantitative and qualitative criteria of a reportable segment as defined under ASC Topic 280.
U.S. Domestic Package
U.S. Domestic Package operations include the time-definite delivery of letters, documents and packages throughout the United States.
During the quarter ended December 31, 2024, based on a change in our management reporting structure, we began presenting our U.S. air cargo product within our U.S. Domestic Package segment. This activity was previously reported within Supply Chain Solutions. This change aligns with how our chief operating decision maker reviews operating results to assess performance and allocate resources. Prior periods have been recast to conform to current year presentation with no changes to consolidated results.
International Package
International Package operations include delivery to more than 200 countries and territories worldwide, including shipments wholly outside the United States, as well as shipments with either origin or destination outside the United States. Our International Package reporting segment includes the aggregation of our operations in Europe, the Indian sub-continent, Middle East and Africa (together "EMEA"), Canada and Latin America (together "Americas") and Asia.
Supply Chain Solutions
Supply Chain Solutions includes our Forwarding, Logistics, digital and other businesses. Our Forwarding and Logistics businesses provide services in more than 200 countries and territories worldwide and include international air and ocean freight forwarding, customs brokerage, mail services, healthcare logistics, distribution and post-sales services. Our digital businesses leverage technology to enable a range of on-demand services such as same-day delivery, end-to-end return services and integrated supply chain and high-value shipment insurance solutions.
Segment information
We consider our Chief Executive Officer to be our chief operating decision maker ("CODM"). The CODM is responsible for setting the Company's strategic direction, managing overall operations, and is the main point of communication between the board of directors and key operational personnel within the organization.
The CODM utilizes operating profit as a primary measure of segment performance because it reflects the underlying business performance and provides the CODM with a basis for making resource allocation decisions. Operating profit is defined as income before investment income (expense) and other, interest expense and income tax expense. Operating profit is considered to be a primary measure of segment performance.
The CODM regularly reviews segment level expense details which include compensation, benefits and purchased transportation expenses when assessing operating segment performance. Compensation and benefits are separately assessed for Domestic Package whereas these categories are assessed together for International Package. These categories are the primary segment expenses used by the CODM to assesses segment performance.
Certain expenses are allocated between the segments using activity-based costing methods. These activity-based costing methods require us to make estimates that impact the amount of each expense category that is attributed to each segment. Changes in these estimates directly impact the amount of expense allocated to each segment, and therefore the operating profit of each reporting segment. Our allocation methodologies are refined periodically, as necessary, to reflect changes in our businesses.
As we operate an integrated, global multimodal network, we evaluate many of our capital expenditure decisions at a network level. Accordingly, expenditures on property, plant and equipment by segment are not presented.
Segment information for the years ended December 31, 2024, 2023 and 2022 is as follows (in millions):
Year ended December 31, 2024 U.S. Domestic International Total
Revenue $ 60,376  $ 17,960  $ 78,336 
Reconciliation of revenue:
Other revenues(2)
12,734 
Total consolidated $ 91,070 
Less:
Compensation and benefits 3,783 
Compensation 20,839 
Benefits 16,862 
Purchased transportation 2,466  3,447 
Other segment items(1)
15,864  7,539 
Segment Operating profit/(loss) $ 4,345  $ 3,191  $ 7,536 
Reconciliation of segment operating profit to income before income taxes:
Other profit/(loss)(2)
$ 932 
Other pension income (expense) (396)
Investment income (expense) and other 236 
Interest expense (866)
Income Before Income Taxes $ 7,442 
Other Segment Disclosures:
Segment assets $ 38,657  $ 18,300  $ 56,957 
Other assets(2)
9,850 
Unallocated assets 3,263 
Consolidated Assets $ 70,070 
Depreciation and amortization(3)
$ 2,470  $ 777  $ 3,247 
Other depreciation and amortization(2)
362 
Consolidated Depreciation and Amortization $ 3,609 
(1) Other segment items for each reportable segment include repairs and maintenance, depreciation and amortization, fuel, other occupancy, allocated costs for our air network, information service, and general and administrative service expenses.
(2) Revenue, Operating profit/(loss), Assets, and Depreciation and Amortization from segments below the quantitative thresholds are attributable to operating segments which provide supply chain solutions. These operating segments include our Forwarding, Logistics, Digital, and Other businesses.
(3) The amounts of depreciation and amortization disclosed by reportable segment are included within the other segment items captions. These totals are presented after applying activity based costing methods to allocate expenses between segments as noted above.
Year ended December 31, 2023
U.S. Domestic
International
Total
Revenue
 $ 60,205  $ 17,831  $ 78,036 
Reconciliation of revenue:
Other revenues(2)
12,922 
Total consolidated
 $ 90,958 
Less:
Compensation and benefits
 3,794 
Compensation 19,818 
Benefits 16,859 
Purchased transportation 2,555  3,391 
Other segment items(1)
15,817  7,415 
Segment Operating profit/(loss)
 $ 5,156  $ 3,231  $ 8,387 
Reconciliation of segment operating profit to income before income taxes:
Other profit/(loss)(2)
$ 754 
Other pension income (expense)
 (95)
Investment income (expense) and other
 314 
Interest expense
 (787)
Income Before Income Taxes
 $ 8,573 
Other Segment Disclosures:
Segment assets
 $ 38,368  $ 17,587  $ 55,955 
Other assets(2)
11,245 
Unallocated assets
 3,657 
Consolidated Assets
 $ 70,857 
Depreciation and amortization(3)
$ 2,290  $ 742  $ 3,032 
Other depreciation and amortization(2)
334 
Consolidated Depreciation and Amortization
 $ 3,366 
(1) Other segment items for each reportable segment include repairs and maintenance, depreciation and amortization, fuel, other occupancy, allocated costs for our air network, information service, and general and administrative service expenses.
(2) Revenue, Operating profit/(loss), Assets, and Depreciation and Amortization from segments below the quantitative thresholds are attributable to operating segments which provide supply chain solutions. These operating segments include our Forwarding, Logistics, Digital, and Other businesses.
(3) The amounts of depreciation and amortization disclosed by reportable segment are included within the other segment items captions. These totals are presented after applying activity based costing methods to allocate expenses between segments as noted above.
Year ended December 31, 2022
U.S. Domestic
International
Total
Revenue
 $ 64,611  $ 19,698  $ 84,309 
Reconciliation of revenue:
Other revenues(2)
16,029 
Total consolidated
 $ 100,338 
Less:
Compensation and benefits
 3,890 
Compensation 20,488 
Benefits 16,603 
Purchased transportation 3,333  3,773 
Other segment items(1)
17,036  7,709 
Segment Operating profit/(loss)
 $ 7,151  $ 4,326  $ 11,477 
Reconciliation of segment operating profit to income before income taxes:
Other profit/(loss)(2)
$ 1,617 
Other pension income (expense)
 2,251 
Investment income (expense) and other
 184 
Interest expense
 (704)
Income Before Income Taxes
 $ 14,825 
Other Segment Disclosures:
Segment assets
 $ 38,303  $ 17,670  $ 55,973 
Other assets(2)
10,407 
Unallocated assets
 4,744 
Consolidated Assets
 $ 71,124 
Depreciation and amortization(3)
$ 2,173  $ 761  $ 2,934 
Other depreciation and amortization(2)
254 
Consolidated Depreciation and Amortization
 $ 3,188 
(1) Other segment items for each reportable segment include repairs and maintenance, depreciation and amortization, fuel, other occupancy, allocated costs for our air network, information service, and general and administrative service expenses.
(2) Revenue, Operating profit/(loss), Assets, and Depreciation and Amortization from segments below the quantitative thresholds are attributable to operating segments which provide supply chain solutions. These operating segments include our Forwarding, Logistics, Digital, and Other businesses.
(3) The amounts of depreciation and amortization disclosed by reportable segment are included within the other segment items captions. These totals are presented after applying activity based costing methods to allocate expenses between segments as noted above.
Revenue by product type for the years ended 2024, 2023 and 2022 is provided in note 2, Revenue Recognition.
Geographic information for the years ended December 31, 2024, 2023 and 2022 is as follows (in millions):
2024 2023 2022
United States:
Revenue $ 70,389  $ 71,749  $ 78,110 
Long-lived assets $ 33,173  $ 33,301  $ 32,002 
International:
Revenue $ 20,681  $ 19,209  $ 22,228 
Long-lived assets $ 13,304  $ 13,687  $ 12,991 
Consolidated:
Revenue $ 91,070  $ 90,958  $ 100,338 
Long-lived assets $ 46,477  $ 46,988  $ 44,993 
Long-lived assets include property, plant and equipment, pension and postretirement benefit assets, long-term investments, goodwill and intangible assets.
No countries outside of the United States accounted for 10% or more of consolidated revenue for the years ended December 31, 2024, 2023 or 2022. For the years ended December 31, 2024, 2023 and 2022, Amazon.com, Inc. and its affiliates ("Amazon") represented 11.8%, 11.8%, and 11.3% of our consolidated revenues, respectively. Substantially all of this revenue was attributed to U.S. Domestic Package. Amazon accounted for approximately 12.8%, 15.8%, and 15.5% of Accounts receivable, net, included within our consolidated balance sheets as of December 31, 2024, 2023 and 2022, respectively.