United Parcel Service shares fell on Tuesday after the company reported quarterly earnings and revenue that missed Wall Street's expectations. The package delivery giant also posted a 2017 outlook below expectations.

Shares of UPS were down nearly 7 percent in midmorning trading following the announcement, on pace for its worst day since Jan. 23, 2014 when it lost 9.91 percent.

UPS reported fourth-quarter earnings $1.63 per share on revenue $16.93 billion. Analysts expected UPS to post $1.69 per share on revenue of $17 billion, according to a consensus estimate from Thomson Reuters.

The company said the quarterly loss was caused by a mark-to-market pension charge.

"Revenue and volume growth accelerated for UPS during the holiday season and we provided high service levels for our customers," David Abney, UPS chairman and CEO, said in a statement. "The International segment delivered another extraordinary performance, while the U.S. managed through considerable changes in product mix. Our strategies and initiatives are creating long-term value for both UPS customers and shareowners."



Late last year, UPS said it expected to surpass 700 million packages delivered globally in the holiday season. During the holiday season UPS delivered more than 712 million packages, a 16 percent increase over the year-ago quarter.

The company said it delivered 1.4 billion packages, up 7.1 percent over the last year. UPS said average daily shipments increased 5 percent to 19.6 million in its U.S. domestic segment in the quarter. Revenue increased 6.3 percent over the quarter last year.

The international segment produced strong volume growth across all major products, UPS said. Revenue in that segment increased 5 percent, driven by a 8.4 percent jump in daily export shipments.

In 2016, the company paid dividends of $2.8 billion, an increase of 6.8 percent per share over the year prior. UPS repurchased 25.5 million shares for about $2.7 billion.

The company also posted its 2017 outlook of $5.80 to $6.10 per share, compared to a Thomson Reuters estimate of $6.16 a share.

UPS said investments in its operations research project, ORION, provided benefits during the quarter.

"However, bottom-line results were challenged by a shift in product mix and the continued softness in industrial production. Strong growth, combined with our network investments, provide UPS with great opportunities for many years to come," Richard Peretz, UPS chief financial officer, said.



On Tuesday, Peretz told CNBC that some of President Donald Trump's proposals, such as tax reform and infrastructure spending, could be good for business conditions.

"We look forward to seeing the regulations as they come out," he said on "Squawk on the Street." "At the end of the day, our job is to take complicated and make it easier for our customers to trade domestically and internationally."