A sharp drop in revenue and profit was reported by UPS in the second quarter. As a result of its tentative agreement with Teamsters, the company also cut its profit forecast.

As a result of the report, UPS (UPS) shares dropped nearly 4% in premarket trading.

UPS reported adjusted income of $2.2 billion in the quarter, down 24% from a year earlier, but slightly better than analysts’ estimates. A decline of 11% in revenue to $22.1 billion was reported.

In addition, the company lowered its full-year revenue outlook by $4 billion to $93 billion. The company said it lost business during its labor negotiations, and online purchases have been weaker as well. Due to the labor deal with the union, the company also expects its profit margin to be 1% lower than its previous guidance.

Shippers began shifting away from UPS after talks broke down in July, which contributed to some of the decline in shipment volumes. Several customers shifted their business to rival carriers to avoid the risk of a strike during the nearly three-week period between the two sides.

In the second quarter, UPS said domestic package volumes were down 10%, while international shipments were down nearly 7%. Because of a softening economy, the company already warned three months ago that it would see lower volumes this year.

The company said it plans to pay dividends of $5.4 billion and repurchase shares of $3 billion even though revenue and earnings guidance were lower.

Teamsters and the company reached a tentative agreement on July 25, just before a strike deadline on August 1. There are now 340,000 union members at the company voting on whether or not to ratify the contract. August 22 is the expected date for the results of the election.