The package courier said on Friday that it dealt with a "an unprecedented level of online shopping that included a surge of last-minute orders." Online shopping is good for UPS, but those last-minute orders snarled its system.
The company said it "took extraordinary measures deploying additional equipment and people," including hiring 30,000 more temporary workers than originally planned. Bad weather last month also hurt results.
It delivered 31 million packages on Dec. 23, a company record. But that peak was reached six days later than UPS had expected.
UPS has not said how many packages missed their delivery deadlines, but customers all over the country reported delays. Amazon.com offered shipping charge refunds and a $20 credit for some customers affected by UPS delays.
FedEx also acknowledged problems.
UPS said its fourth-quarter profit will be $1.25 per share. Analysts surveyed by FactSet had been expecting $1.43 per share. It said its full-year profit would be $4.57 per share, after issuing previous guidance of $4.65 to $4.85 per share.
Its shares dropped $2.59, or 2.6 per cent, to $97.90 in morning trading Friday.
UPS reports full results on Jan. 30.