Good morning. My name is Matthew, and I will be your facilitator today. I'd like to welcome everyone to the UPS Second Quarter 2025 Earnings Conference Call. [Operator Instructions] It is now my pleasure to turn the floor over to your host, Mr. PJ Guido, Investor Relations Officer. Sir, the floor is yours.

Good morning, and welcome to the UPS Second Quarter 2025 Earnings Call. Joining me today are Carol Tome, our CEO; Brian Dykes, our CFO; and a few additional members of our executive leadership team. Before we begin, I want to remind you that some of the comments we'll make today are forward-looking statements and address our expectations for the future performance or operating results of our company. These statements are subject to risks and uncertainties, which are described in our 2024 Form 10-K and other reports we file with or furnish to the Securities and Exchange Commission. These reports, when filed, are available on the UPS Investor Relations website and from the SEC. Unless stated otherwise, our discussion refers to adjusted results. For the second quarter of 2025, GAAP results include a net charge of $29 million or $0.04 per diluted share, comprised of after-tax transformation strategy costs of $57 million, which were partially offset by a $15 million gain from the divestiture of the business within Supply Chain Solutions and a $13 million benefit from the partial reversal of an income tax valuation allowance. A reconciliation of non-GAAP adjusted amounts to GAAP financial results is available in today's webcast materials. These materials are also available on the UPS Investor Relations website. Following our prepared remarks, we will take questions from those joining us via the teleconference. [Operator Instructions] And now I'll turn the call over to Carol.

Thank you, PJ, and good morning. To begin, I want to thank all UPSers for their hard work and efforts, as we've made material progress against the strategic actions we laid out in January. Those actions include accelerating the glide down of Amazon volume, transitioning our ground saver product and generating savings through our Efficiency Reimagined initiatives. During the quarter, our team of dedicated UPSers remained focused on execution, while keeping supply chains moving and delivering best-in-class service. Our second quarter financial results reflect the impact of a complex macro environment, driven by ever-evolving trade policies, as well as the significant actions we are taking to strengthen UPS' competitive and financial positioning. Looking at our second quarter results. Consolidated revenue was $21.2 billion. Consolidated operating profit was $1.9 billion, and consolidated operating margin was 8.8%. As Brian will provide more detail regarding our financial results, I'd like to comment on what we are seeing from a business climate perspective and then spend my time talking about the progress we are making on our strategic action. So first, our thoughts on the business climate. Despite uncertainties around trade policies, in the second quarter, the overall U.S. economy demonstrated continued resilience, but our sector, specifically the U.S. small package market, was unfavorably impacted by U.S. consumer sentiment that was near historic lows. A recent research report from McKinsey showed that in the face of tariffs and other uncertainties, consumers are trading down, while at the same time, splurging. For the first time in 3 years, consumer spending on discretionary categories like restaurants and automobiles outpaced growth in essential items. And on the commercial side of the economy, manufacturing activity in the U.S. remains soft. These macroeconomic dynamics impacted overall market demand as well as demand by customer segment and product. In the…

Chief Financial Officer & Executive Vice President Thank you, Carol, and good morning, everyone. This morning, I'll cover 3 areas, starting with our second quarter results, then I'll discuss progress with the Amazon volume glide down, our network reconfiguration efforts and our Efficiency Reimagine initiatives. Lastly, I'll comment on our capital allocation priorities for the year. Moving to our results. Starting with our consolidated performance. In the second quarter, revenue was $21.2 billion, and operating profit was $1.9 billion. Consolidated operating margin was 8.8%. Diluted earnings per share were $1.55. Now moving to our segment performance and starting with U.S. domestic. Through our Amazon volume glide down strategy, we are shifting the mix of our U.S. business. We are laser focused on improving revenue quality, and the changes we are making are beginning to show up in our results. For the quarter, total U.S. average daily volume was down 7.3%, primarily driven by our planned glide down of Amazon volume and revenue quality efforts. Total air average daily volume was down 11.6%. When excluding Amazon, total air ADV increased 1.4%, driven by healthcare and high-tech customers. Ground average daily volume was down 6.6% year-over-year, and within ground, Ground Saver ADV declined 23.3%, primarily due to the pricing actions we took on e-commerce volume. In the second quarter, Ground Saver made up the smallest portion of our total ground volume that we've seen in 2 years. This shift is a proof point showing positive product mix improvement. In terms of customer mix, ADV growth within our small and medium-sized customers was lower than we anticipated. Year-over-year, the SMB growth rate was flat. However, we saw some bright spots in SMB healthcare, manufacturing and automotive. In the second quarter, SMBs made up 32% of total U.S. volume, a 230 basis point improvement…

[Operator Instructions] Our first question comes from the line of David Vernon of Bernstein.

This is Justine Weiss speaking on behalf of David Vernon. So I'm just wondering, is the lack of guidance in some ways a sign that things are worse? Or is this purely about things still being uncertain? And also, how do you feel about the progress on cost cuts being enough to exit with domestic margins at double digits?

Well, Justine, thanks for your call and question. And I'll start with the rationalization for not providing guidance. First, we debated this a lot. But there's so much uncertainty out there. We are building scenarios, and the range of the scenarios, well, it's wide enough to drive one of our 18 wheelers through. So we elected not to provide guidance. And let me tell you why. First, if I look at the volume in July, it's actually a bit better than what we've been seeing. But part of that in the United States anyway was influenced by Amazon Prime Day and other retailers who had similar like promotions. And so we're not sure that the volume in July is an indicator of the volume for the rest of the quarter. Further, the volume outside the United States was strong, too, but we believe that's because companies were purchasing inventory ahead of the August 1 tariffs. So July, while good, we don't think it's a predictor necessarily of the rest of the quarter. Why? Because of the uncertainty. As we look at the tariffs, there are a number of tariffs that are slated to go in on August 1. We don't know if that's going to happen or not. There only have been 6 trade deals that have been negotiated. So there's a lot of uncertainty regarding the tariffs. As it relates to the China tariff, that agreement expires on August 12. Now it's a rumor that, that will be extended, but we don't know. And so there's uncertainty around tariffs, and then, there means there's uncertainty around consumer demand. So consider this. At the end of the first quarter, our customers had inventory, and they sold that inventory down in the second quarter. They're now at a point where they…

Chief Financial Officer & Executive Vice President Yes. Thanks. Sure. And I think Carol hit on all the right points, right? So volume remains depressed right now, right? And there's the possibility, particularly with our retail and SMB customers that look, it could get better, it could get a little bit worse as we go in. And we're dealing with those higher -- the lower attrition and higher Ground Saver costs as we've got. So as you think about Q3 margins, they could be pressured a little more than we thought earlier in the year, even more than the kind of normal seasonality that we have from Q2 to Q3. International and SCS, I mean, you see in the performance, things are holding pretty well. We expect those to be about the same. And we're going to get clarity as we go through the quarter on this, right? What we can say, look, is we've got a high degree of confidence, and I think it's starting to show in the results that the actions that we're taking are setting ourselves up for the longer term, right? The rev per piece is turning. The growth in international is positive. And this is going to put us in a much more -- a much better competitive position, not only to drive growth in the future, but expand margin.

All really helpful. So it sounds like basically exiting domestic margins at double digits is just a bit uncertain right now.

We'll have more certainty by the end of the third quarter. Yes.

Our next question comes from the line of Ariel Rosa of Citigroup.

This is Ben Mohr of Citi on for Ari Rosa. At this rate of the China to U.S. parcel lane shifts to the rest of Southeast Asia, like Vietnam or Thailand to the U.S., when do you expect to fully lap those costs on the trade lane shifts? And with your total investments in infrastructure in the rest of Southeast Asia, as it stands, is there enough excess capacity to handle these shifts? Or will you need to make additional infrastructure investments into Southeast Asia in order to handle these shifts?

Well, we're really pleased with how our integrated network is meeting the demands of our customers. And Kate, why don't you give some color?

Yes, absolutely. So I think you may recall, we engage with tens of thousands of customers to see how we could help them with supply chain shifts. Some of them were able to move faster than others, some are waiting for the outcome of the tariffs. But that said, we've unlocked the growth of rest of world to rest of the world. Now the China to U.S., as we indicated, was down, and then, the China-rest of world is up. We have shown agility, and to the question on capacity, we are shifting our resources around, and we do it very quickly so that we can capture that growth. In terms of investments, we actually were building out an Asia diversity strategy for the last few years. And with that, we actually were seeing, call it, 10% type growth that we're unlocking. So it's not a cost, it's actually alignment of resources now to the increased trade lane flow outside of the U.S. So we are capturing that. China, again, rest of world, over 20%. You mentioned Southeast Asia, Malaysia, Vietnam, all growing over 20%. We've doubled India. So we are seeing that UPS' global integrated network is capturing that growth. Now, as we deal with the revenue per piece changes, so again, it's not the cost side as much as the revenue per piece. We are unlocking that profitable growth, and we will be harnessing more of it, as the India's get stronger. You'll see a heavier weighting, and that too is profitable to offset China.

And maybe just a couple of other comments about investments because to Kate's point, we got ahead of this. We are expanding our air hub in Hong Kong. We are building a brand-new air hub in Philippines, and that positions us very well for these changing shifts in trade lines. I think it's important to remember that of the 80 largest trade lanes in the world, 49 have an Asian country on one end of the trade lane and 22 have an Asian country on both ends of the trade lane. So the investments that we laid out several years ago now, we'll be able to capitalize on the shifting trade lines.

Great. And maybe if I can ask a follow-up more domestically. We've seen smaller parcel carriers taking share in the parcel market, names like LaserShip, SpeedX, some big economy carriers that compete with your Roadie. Do you see them as you work on existing or prospective customers that put out RFPs to bid? What's your view on their strategy? They seem to be competing on price and less comprehensive service. What's your strategy to maintain your competitive moat?

Well, competition is good. I will say that. Our offering is very different than theirs because we do operate an end-to-end network, and I mean end-to-end from one coast to the other coast. And every aspect of the supply chain, we can meet our customers' needs. From a market share perspective, we look at the addressable market. And for us, we define the addressable market as the market that excludes Amazon and excludes packages that are less than 1 pound. That market in the second quarter was soft, but we gained share. We're very proud of the fact that we gained share in that market even in this highly competitive environment.

Chief Financial Officer & Executive Vice President And Carol, if I can just add one thing to that because I think it's really important that the rev per piece growth of 5.5% is starting to show that the strategy of dynamically changing the volume in the network is working, right? And if you look at the segments where it really matters for us, SMB, our penetration was up 230 basis points. Commercial, our penetration was up 220 basis points. We actually saw our zone, which means people who are using our end-to-end network over long distances, get longer for the third straight quarter, right? The pace of the weight decline, which has been an industry trend, is slowing, right? So we are shifting the volume and the characteristics in our network to customers that keep value in our service offering.

And we could talk a lot about the capabilities that we offer that our competitors do not, like on healthcare, we have special labels that our competitors do not or we have RFID tagging on our packages that our customers do not or we have returns, boxless, labelless returns that our competitors do not. So from a capability perspective, we will continue to invest in the capabilities that set us apart from our competitors.

[Operator Instructions] Our next question comes from the line of Bruce Chan of Stifel.

Just wanted to dig into the SMB results a little bit more and see if you could provide some thoughts around whether that is all just policy uncertainty and something you think could accelerate if maybe we get more clarity on the macro or if there's anything maybe coming from competitive pressure as some of your peers are chasing that business as well?

So as we said, our SMBs are a bit challenged. We have -- we talked to our SMB customers to understand how they're thinking about the current trade environment, and many of them are wrestling. They want to find different alternatives of sourcing. But as they knock on the door, they're not necessarily gaining attention from the countries where they might be able to move their sourcing to. So there's really a lot of trade uncertainty out there. And it's not just trade uncertainty. Some of them are finding that in today's environment, credit conditions have tightened up a bit on them. So it's not that they don't have access to capital in the ways that they have seen in prior years. So there are a number of just challenges that this group is faced with. Our job is to listen to them through our supply chain mapping capabilities, help them think about how they might move their sourcing around, help them think how they might be able to reduce their costs by moving inventory in different places or using different modes of transportation. So with over 600 supply chain mapping projects in the second quarter, many of that came from our SMBs. And Matt is here. Matt, is there anything you'd like to add on SMBs?

I'll just highlight one thing just to complement what Carol said. I think SMBs are disproportionately impacted in this space. However, they're looking to UPS, and where the strength of our capabilities, the strength of our network is really what positions us well right now. They come to us, one, because they trust the brand. But to Carol's point, they're looking to where they should source and should they ship manufacturing. They're looking at modes, do you keep it near, do you put it on an ocean container? And when we think about end-to-end, we do think about coast-to-coast, but we think about it globally across the world because we have an integrated network that positions us to win in that space.

I might highlight healthcare as well in the SMB. We are seeing the shining light through our differentiated capability with our lab packers. And our U.S. operators are delivering 99% plus on basically doctors' offices and assurance that your lab sample will go back to the lab, your specimens be tested. And literally, we get into Worldport, up to, call it, 1 a.m., and it's on -- back on to the patients if it's a treatment doorstep by 10:30. I mean that is exceptional service.

And maybe one other comment, just a bright spot on SMB world, and that's our digital access platform. That platform continues to provide excellent service for our customers. We have 41 partners on that platform serving over 7 million shippers, and we saw good growth on that platform again in the second quarter.

Your next question is coming from the line of Chris Wetherbee of Wells Fargo.

It's Rob Salmon on for Chris. With regard to the outlook that you just provided, Brian, in terms of the second half shape of the margins, could you discuss a little bit more how international package margins trended over the quarter as you saw the much bigger declines on that Asia -- on the China-U.S. trade lane? And what your expectations are looking out to the third quarter? I thought I heard flattish, but it would be really helpful if we could get a little bit of color given the cost adjustments that you guys were making there.

Chief Financial Officer & Executive Vice President Sure. And, Rob, I do think it's worthwhile to brag a little bit on the international and the air team here because we did see -- the trade flows played out about as we expected. But as Carol mentioned, the magnitudes were very different, right? And so we did see that China to the U.S. decline more than what we expected. We saw China to rest of the world increase more, particularly in specific lanes. Within the second quarter, we made over 100 ad hoc adjustments to our air network to flex to what our customers needed us to do, which I think is a tremendous accomplishment for the international team, and it shows up in the export growth numbers that were really, really strong. Now what that does mean is, look, there's some frictional costs, right, as you're adjusting that air network. And I think as we move through the third quarter and we get more certainty on tariffs, we get more certainty on orders for peak from our customers, we'll be able to harden off the capacity on those lanes, get the assets in the right place and continue to drive the margin. Right now, we think it's kind of the same second quarter to third quarter. But as we get more certainty, that allows us to make adjustments that can drive the margin back to where we think international can be, mid to high teens over the long term.

And part of the margin contraction was due to less demand related surcharges this year than last. And where do we lap that, Brian?

Chief Financial Officer & Executive Vice President We'll lap that in the fourth quarter.

Yes.

Our next question comes from Ravi Shanker from Morgan Stanley.

Carol, you said that the Amazon glide down is proceeding for the most part as planned. Can you share some light on what is not going as planned? Maybe kind of is it just the shifting rate of drawdown in 1Q and 2Q? Or is there something else different than expected?

It's simply the attrition rate. The attrition rate is not where we thought it would be. And as I mentioned, Ravi, the building closures were back-end weighted towards the end of the quarter. And what we see, as time goes on, the longer a building is closed, the higher the attrition rate. To make that real for you, in the first month of closure, it's in the single digit. By the third month of closure, it's 25%. So the turnover on the hard time hourly side is going to normalize over time, as we -- as time progresses. On the full-time drivers, they have the opportunity to bump into a building. They can follow the work and bump into the building if there's no driving work. And that's fine for them, but that's they choose to do that, but we are offering them an opportunity to leave with a nice check if they say that's not work we want to do. And if you think about our drivers, Nando, tell me how many of our drivers have been driving for 35 years or more?

Yes. So 84%, 85% of our drivers are at top end of our pay scale, and anywhere from 25 to 40 years of service, we have thousands and thousands of drivers that we're entertaining a bio package. And just one comment on the Amazon glide down. That is our biggest concern, but something we have to deal with, that we had modeled a little differently. But on the whole, when you look at the variable expense that Brian had talked about, 8 million hours in the quarter, the semi-variable 9,500 more employees, and we see part-time attriting faster than full-time. So we'll be at an, call it, even as we continue drawing down on Amazon. So the real concern is in our full-time category. And then for our fixed buildings, I'd say it's mostly administrative. So payroll, assigning people to the right new facilities and new positions. But in the end, 74 facilities, 155 operations, I think done rather smoothly, and our service continues to be very strong still.

So I couldn't be more pleased with how we're progressing on this strategic pivot. It's just we modeled an attrition rate that didn't hold in the second quarter, but we expect that to correct over time.

Chief Financial Officer & Executive Vice President And, Ravi, one other thing I would just add because I think it's important on the top line, the volume, we've worked very closely with Amazon on the glide down and how we do this in an orderly manner for both our network and their networking customers, and it's all going very well. As you think about the pace of that, we always said the first half was around 13%, and the second half jumps to 30%. Just to kind of give you context on that. What that means is from the second quarter to third quarter the decline is an incremental sequential 500,000 pieces, right? And so that's why we're moving to get ahead of the cost out. Nando's team has got a great plan on how we pull down on the assets, the hours and the people as we go into the second half, and we're tracking to that $3.5 billion cost takeout.

If I could just add, also, that's a big number, 30%, when you think about it, but we're going to feather into a peak season in a much more efficient way. As we think about peak and the spike, although we don't have 100% of the picture yet, we will see that Amazon glide down feathers into peak very nicely for our company.

That's really helpful detail. Is there a risk that this lower attrition rate could put that $3.5 billion of cost savings at risk or maybe shift the timing out a little bit? Or do you expect that to catch up over time?

We expect that to catch up over time.

Our next question comes from the line of Conor Cunningham from Melius Research.

Maybe just sticking with the facility closures. So you did 74 in the first half. I was hoping that you could level set on what you expect to do in the second half. And in the same context, could you talk about how much volume is going through fully automated facilities? And then where do you expect that to end in 2025? The bigger question I have though is, is that all enough that we get to the point where we can start to see margins uptick next year? I realize there's a lot going on in the world. But just as you level set today, just how that's altered -- how it's all going right now?

Chief Financial Officer & Executive Vice President Sure. Thank you very much for the question. And on the building closures, look, we're evaluating a number of different options. There are several buildings that we're looking at. And we'll come back with more information on how many that we're going to do. Because there's the Amazon piece and then there's also the macro, and we've got to take into account the impact on the entire network. So we'll provide more color on that. On the automation, look, we continue to invest in automation within the network. Because remember, we're not just fighting down Amazon volume and e-commerce volume, we're also investing to be a more efficient network that's going to make us higher margin as we go forward. In the second quarter, 64% of our volume went through automated facility, up from 60% in the second quarter of last year. So we continue to make material improvement. And those automated facilities give us more flexibility to add sorts, be more dynamic with how we manage the volume, and ultimately, will help us scale more efficiently for peak and drive better cost structure as we reset the network.

Well, Conor, this is a big strategic pivot. And the reason why we're doing this is to grow the U.S. margin. So we were all hands on deck here to grow the U.S. margin.

Chief Financial Officer & Executive Vice President But I think it's another great proof point. Look, we got a proof point, and we're getting the right volume into the network. We're getting more volume through automation. And ultimately, Carol, you're exactly right, that drives better long-term margin.

Yes.

Our next question is coming from the line of Jordan Alliger from Goldman Sachs.

Curious, I know there's a lot of peak uncertainty out there, and perhaps customers are waiting and seeing to see what happens. And to the extent maybe that delays stuff coming in and containers on ocean ships, et cetera. I mean, is it possible if the consumer stays resilient that your peak season surge as people need faster air could actually give some tailwind to back half of the year or at least the fourth quarter?

It's absolutely possible. We just don't have the plans yet. I talked to a CEO recently, and I said, what do you think about peak, he says, I'm planning to win, which tells me that he is planning to have a pretty good peak here. So we will have a better sense of this though at the end of the third quarter, at which time we will plan to give you guidance.

Your next question is coming from Ken Hoexter from Bank of America.

I guess on ground margins, maybe 2 parts, Carol. I think I'm a little confused on your answer to Ravi on the Amazon side, where you talked about the time of facility closures relative to the attrition rate. I just want to understand though, the concept, is the volume still on target with as you expected? Or it sounded like this quarter was a little lighter in terms of fading away. And so I'm just not certain. Is that changing the plans from the pace you're moving Amazon? I got that you're going to accelerate the 30%, but I just want to understand if something happens where they don't fade away. And then secondly, on the Ground Saver, are you surprised that you won the business 2 quarters ago? Are you confident still to get to the double-digit margins? I'm just surprised in such a short time frame from winning the contract that we're not seeing -- there's cost adjustments that need to be made. Maybe you could talk about that.

All right. So on the Amazon glide down, the glide down -- I'll just give you the numbers, in Q1, the glide down was 600,000 pieces a day. In Q2, the glide down was 400,000 pieces a day. It was a little lighter than we had anticipated, but that's because of volume we wanted to keep. As you recall, the -- we have a very complicated relationship with Amazon. And part of it is volume that we want to grow and keep, and part of it is volume that we want them to deliver. And the volume that we want to grow and keep, it was better than we anticipated. So I give that a check in the right direction. The only thing that's off is the attrition rate. And the attrition rate, we had modeled an attrition rate based on when we thought it would come in. It's coming in a little bit later than we thought, but it's still going to come in. So from a -- for a full-year perspective, very pleased with the Amazon glide down. Now, on Ground Saver, we, too, had a modeled algorithm that we put into our plan regarding delivery density per stop. That algorithm did not work. And so what we found is that we had more expense than we had anticipated in the second quarter. To dimensionalize that for you, it was about $85 million. We are working on operational changes that we could make, but we also have reengaged with the USPS. There's new leadership there, they have excess capacity, and so we're having a discussion with them. Brian, what would you like to add?

Chief Financial Officer & Executive Vice President And Ken, and I think, look, we also have a very complicated relationship with the USPS as well. And I want to distinguish Ground Saver, which was our former SurePost product, where we in-sourced the volume from the USPS from the air cargo volume that we won last year. The air cargo volume, look, it's going great. It's fully implemented, teams work really well together. As with every relationship, there's operational stuff that we're constantly working on to make each other better. But I think that's been a win for the USPS. It's been a win for us, and it's driving accretive margin. So that the Ground Saver, where we in-sourced our former SurePost volume, is causing a little bit of the cost inflation.

Our next question comes from the line of Stephanie Moore of Jefferies.

This is Joe Hafling on for Stephanie Moore. A busy day for transports today. Carol, I kind of wanted to go back to peak season and understanding that we'll get more clarity as kind of the year progresses, but I'm sure you've seen maybe some of the same calls that we won't see a peak season this year or that peak season already occurred with all the pre-tariff shipping. So I don't know if you had any thoughts on that or if your conversations with shippers where inventory levels currently are. I know the demand picture remains uncertain, but you could maybe help unpack kind of the puts and takes when thinking about peak season in that regard.

Yes. So we have about 100 customers that drive 80% of the surge during peak. Ordinarily, we don't get peak plans until the end of August, and then, final plans at the end of September. I think they're going to be pushing them more into September, as they're working through their plans. In my conversations with CEOs, no one is telling me they're not going to have a peak, but they're not in a position to dimensionalize that for us, as you can appreciate, because all of the macro issues that we are all facing. So we are going to be ready for whatever happens because to Nando's point, we have more agility in our network than ever before because of the strategic pivot that we've made with our largest customer. So we'll be prepared up or down. Well, Nando, what would you like to add?

We'll be prepared if there's a volume influx or a volume reduction. Peak season for us is very variable, so we're able to scale up, scale down as quickly as possible. And those expenses don't linger once we scale down if that's what we need to do. Scaling up, not concerned that -- where we currently sit. But, again, everything we're doing from Network of the Future, the scaling down on Amazon, is all feathered into our peak season plans, and so it should fit quite nicely and allow us to have a really good quality service peak season as well.

And Matthew, we have time for one more question.

Certainly. Our final question comes from the line of Scott Group of Wolfe Research.

This is Jake Lacks on for Scott. So just to confirm, are the employee buyouts included in the $3.5 billion of savings? And any early sense on how large it can be? And then, any updates you can provide on efficiency reimagined looking out into 2026? And do you think you can see a similar number as Amazon volumes continue to glide down? Or does this lower attrition mean maybe there's some more limited opportunities here?

Chief Financial Officer & Executive Vice President So thanks for the question. So first of all, yes, so the driver separation package is a lever for us to get to the $3.5 billion. So it's a means for us to accelerate the attrition levels to get back on plan. And we expect that, as Carol said, part-timers will work out over time. Full-timers, we'll get them on plan. As far as efficiency reimagine goes, look, we're seeing good traction. We saw a steep ramp in the second quarter. It will ramp in the back half, and then, that wraps next year. So yes, we would expect that the volume for Amazon to be declining, efficiency reimagine ramps, it will carry through a similar number to next year.

It's early days on the driver buyout, but so far, it's progressing as we would expect. Once we have gotten it finished, and we understand the dollar or number of drivers who have elected to leave us, then we can tell you what the money is.

I will now turn the floor back over to your host, Mr. PJ Guido.

Thank you, Matthew. This concludes our call. Thank you for joining, and have a great day.