Amazon has signed a multi-year deal with FedEx to handle residential deliveries of select large packages, marking a shift in its logistics partnerships following UPS’s move to scale back its services for the e-commerce giant.
FedEx shares rose 7% on Monday following the announcement, outperforming broader market gains. The Memphis-based logistics company described the agreement as “mutually beneficial,” signalling renewed cooperation after the two companies ended a similar partnership in 2019.
Amazon confirmed the deal, originally signed in February, and said FedEx would supplement its existing third-party delivery partners, including UPS and the U.S. Postal Service, rather than replacing any of them. The agreement reportedly provides Amazon with more cost-effective shipping compared to UPS.
The timing of the FedEx partnership follows UPS’s announcement in January that it would reduce its shipment volume for Amazon, its largest customer, by over 50% by the second half of 2026. In line with that strategy, UPS revealed plans last month to cut 20,000 jobs and close 73 facilities to reduce costs and improve efficiency.
FedEx and UPS have long competed for market share in the package delivery sector, frequently shifting customer accounts as both companies adapt to changing logistics demands and strategic priorities.
