United Parcel Service Inc. (UPS) lowered its full-year profit outlook as the company boosts spending to help handle booming demand for fast shipping during the holidays. The shares tumbled the most in a year.
The company now forecasts earnings per share to be $4.90 to $5, it said in its second-quarter statement today. That’s lower than the outlook the Atlanta-based company gave in April of $5.05 to $5.30 a share.
UPS said it plans to spend $175 million on improving its shipping during the holiday crush, specifically expanding operations on the day after Thanksgiving, and making improvements to its Orion software that helps plot the best route for drivers. Last year harsh winter weather and a last-minute surge in online orders caused UPS to miss some Christmas deliveries.