(This story has been corrected to remove reference to Amazon in paragraph 6)

(Reuters) -Amazon said on Monday it has struck a new partnership with FedEx in late February to handle some parts of its package deliveries.

FedEx shares rose 1.7% after the closing bell.

Business Insider first reported the news on Monday, citing an internal document. The deal with rival FedEx gives Amazon “cost favorability” compared to UPS, the report said.

UPS said in January that it plans to shrink shipment volumes for Amazon, its largest customer, by more than 50% by the second half of 2026. This is a part of the delivery firm’s plan to focus on fewer, but more profitable deliveries.

Late last month, UPS said it would slash 20,000 jobs and shut 73 facilities as a part of its planned reduction in deliveries for Amazon.

FedEx did not immediately respond to Reuters’ requests for comment.

(Reporting by Christy Santhosh and Aishwarya Jain in Bengaluru; Editing by Leroy Leo)