UPS profits down 43.4%, but results beat Wall Street estimates

He noted UPS will hire about 50,000 temporary workers for the holidays, which is below average.

In the third quarter, UPS beat analyst estimates by three cents with a net profit of $549 million, or 55 cents per share. Though at the top of UPS's quarterly guidance, it was a 43.4 percent drop from the same quarter a year ago.

Revenue dropped about 15 percent, to $11.2 billion.

The Sandy Springs-based company is largely dependent on consumer spending, which has been dampened during the prolonged downturn and credit crunch. Consumers spending spurs orders and manufacturing, which results in shipments through companies like UPS and archrival FedEx. These shippers are widely considered a barometer of sorts for economic activity.

In September after its most recent quarter, FedEx reported profits dropped 53 percent to $181 million, or 58 cents per share, on revenue of $8 billion.

Both companies showed a modest improvement in premium air shipments.

UPS CEO Scott Davis said, "To say the economic recession is over is different than to say we've recovered. While the recovery has begun, it has a long way to go."

Kuehn said two signs the company is looking for are higher employment and more manufacturing.

The UPS executives noted they shored up profit by cutting operating expenses an estimated $1.4 billion for the year, and capital investments by $500 million.

UPS said it expects fourth quarter earnings in the range of 58 to 65 cents per share. Analysts expect63 cents.

Analysts in general warmed to UPS's premium air volume increasing, as well as the uptick in Western and Eastern Europe shipments. Jon Langenfeld with Baird said in a note he continues to like UPS's long-term prospects.