“We continue to expect approximately $800 million of international export yield pressure as demand surcharges significantly diminish and service mix continues shifting towards deferred offerings.”

In context

“be closely monitoring the demand environment going forward, including economic activity in North America, Europe and Trans-Pacific trade. We'll also be keeping a close watch on other key factors that impact the demand environment, including inventory restocking, inflation and e-commerce trends. Turning to slide 18. And consistent with last quarter, we want to share how we're thinking about the operating profit considerations embedded in our full year outlook. For illustration purposes, we used adjusted operating profit of $6.3 billion, which is the equivalent of the adjusted EPS midpoint of $17.75. Within this outlook, we're highlighting a few key assumptions. Revenue, net of cost increases, is now expected to be up $500 million due to improved revenue quality and flow-through at Ground. We continue to expect approximately $800 million of international export yield pressure as demand surcharges significantly diminish and service mix continues shifting towards deferred offerings. As a result of our strong first quarter performance, we're also planning for a $600 million increase in variable compensation. These headwinds are more than offset by the $1.8 billion in structural cost savings from our DRIVE initiatives, which we shared with you last quarter and are on track to achieve. Moving on to slide 19. We remain steadfast in our commitment to prudent capital allocation and shareholder returns. Our liquidity position remains strong and we ended the quarter with $7.1 billion in cash. Capital expenditures for the quarter were $1.3 billion and we continue to expect to achieve our target of less than 6.5% CapEx to revenue for the year. Our capital expenditures at Ground will decline as we reduce capacity investment, and we're planning for lower annual aircraft CapEx ov”