United Parcel Service Inc. (UPS) reported better-than-expected quarterly earnings and revenue on Tuesday, bolstered by strong e-commerce demand that has allowed the delivery firm to raise shipping prices and cherry-pick more profitable customers.

The company also raised its full-year adjusted operating margin target to about 13% from about 12.7%, ahead of the holiday season. Shares of Atlanta-based UPS were up about 2% before the opening bell. UPS and rival FedEx Corp are delivering record number of e-commerce packages amid labor shortages since COVID-19 shifted shopping online.

To beef up its delivery operations, UPS outlined plans last month to buy Roadie, a crowd-sourced, same-day delivery company whose major clients include home improvement chain Home Depot.

Revenue from UPS' U.S. operations, its biggest segment, rose 7.4% to $14.21 billion.

The company's third-quarter operating profit rose to about $2.9 billion, or $2.65 per share, in the third quarter ended Sept. 30, from $2.36 billion, or $2.24 per share, a year earlier.

On an adjusted basis, operating profit was $2.71 per share, above the average analyst estimate of $2.55, according to Refinitiv I/B/E/S data. Revenue rose 9.2% to $23.18 billion, beating expectations of $22.56 billion.