Thursday's looking pretty bleak for investors in United Parcel Service (NYSE: UPS) stock, down 5.5% through 10:35 a.m. ET despite beating on earnings this morning.

Heading into its third-quarter 2023 report, analysts had forecast that UPS would earn only $1.52 per share for the quarter, but UPS actually earned $1.57 per share, (adjusted for one-time items, making this a non-GAAP number). That's the good news. The bad news is that UPS was also supposed to do $21.4 billion in revenue last quarter, but it only did $21.1 billion -- hence, an earnings beat paired with a sales miss.  

And the news gets worse. Sales at UPS declined 13% year over year in Q3, but because UPS has such high fixed costs, when revenue starts declining, its profits tend to decline even faster. UPS's adjusted earnings in Q3 were barely half what it earned a year ago. And when calculated according to generally accepted accounting principles (GAAP), UPS's earnings were even weaker -- just $1.31 per share, or 56% below Q3 2022 levels.

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Source Fool.com