Quarterly report [Sections 13 or 15(d)]

SEGMENT INFORMATION

v3.25.1
SEGMENT INFORMATION
 3 Months Ended
Mar. 31, 2025
Segment Reporting [Abstract]  
SEGMENT INFORMATION SEGMENT 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 results 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 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. International Package includes our operations in Europe, the Indian sub-continent, Middle East and Africa ("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 and other, interest expense and income tax expense.
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. There were no significant changes to our allocation methodologies in the first quarter of 2025.
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.
Three Months Ended March 31, 2025 U.S. Domestic International Total
Revenue $ 14,460  $ 4,373  $ 18,833 
Reconciliation of revenue:
Other revenues(2)
2,713 
Total consolidated $ 21,546 
Less:
Compensation and benefits 957 
Compensation 5,098 
Benefits 4,169 
Purchased transportation 162  905 
Other segment items(1)
4,052  1,870 
Segment Operating profit/(loss) $ 979  $ 641  $ 1,620 
Reconciliation of segment operating profit to income before income taxes:
Other profit/(loss)(2)
$ 46 
Other pension income (expense) 37 
Investment income and other
 42 
Interest expense (222)
Income Before Income Taxes $ 1,523 
Other Segment Disclosures:
Segment assets $ 37,452  $ 17,592  $ 55,044 
Other assets(2)
10,785 
Unallocated assets 2,637 
Consolidated Assets $ 68,466 
Depreciation and amortization(3)
$ 623  $ 202  $ 825 
Other depreciation and amortization(2)
87 
Consolidated Depreciation and Amortization $ 912 
(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, 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.
Three Months Ended March 31, 2024 U.S. Domestic International Total
Revenue $ 14,266  $ 4,256  $ 18,522 
Reconciliation of revenue:
Other revenues(2)
3,184 
Total consolidated $ 21,706 
Less:
Compensation and benefits 944 
Compensation 4,872 
Benefits 4,180 
Purchased transportation 556  798 
Other segment items(1)
3,825  1,858 
Segment Operating profit/(loss) $ 833  $ 656  $ 1,489 
Reconciliation of segment operating profit to income before income taxes:
Other profit/(loss)(2)
$ 124 
Other pension income (expense) 67 
Investment income and other
 51 
Interest expense (195)
Income Before Income Taxes $ 1,536 
Other Segment Disclosures:
Segment assets $ 36,988  $ 17,859  $ 54,847 
Other assets(2)
10,929 
Unallocated assets 1,852 
Consolidated Assets $ 67,628 
Depreciation and amortization(3)
$ 603  $ 196  $ 799 
Other depreciation and amortization(2)
99 
Consolidated Depreciation and Amortization $ 898 

(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, 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.