The US Postal Service posts $1.25 billion quarterly loss amid mounting cash pressures, underscoring the growing financial strain on the agency and reigniting debate over long-discussed structural reforms.
The U.S. Postal Service reported a net loss of $1.25 billion for the quarter ended December 31, highlighting persistent liquidity challenges that continue to weigh on its balance sheet. The result marked a sharp reversal from the same period a year earlier, when the agency recorded a quarterly profit of $144 million.
Revenue Slips, Reform Calls Grow Louder
Operating revenue for the quarter declined 1.2% to $22.2 billion, reflecting ongoing pressure from falling mail volumes and rising costs. The Postal Service has struggled to offset the steady erosion of first-class mail, historically its most profitable line of business, which has now dropped to its lowest levels since the late 1960s.
Against this backdrop, postal officials urged lawmakers to act. They called for changes to Civil Service Retirement obligations, greater flexibility in setting postage prices, and an increase in the agency’s $15 billion statutory debt ceiling—steps they argue are critical to stabilizing finances.
Leadership Warns of a Broken Model
Postmaster General David Steiner acknowledged that the challenges run deeper than short-term fluctuations. He said the agency’s financial and operational framework no longer aligns with modern delivery realities.
According to Steiner, USPS has assembled a dedicated internal team to examine every aspect of the business, with a focus on trimming costs and reassessing capital spending. He described the situation bluntly, warning that without meaningful reform, the agency’s financial outlook remains bleak.
Since 2007, USPS has accumulated roughly $120 billion in net losses, a figure that reflects both structural inefficiencies and dramatic shifts in how Americans communicate and shop.
Betting on the Last Mile
In a bid to generate new revenue streams, USPS recently launched an online bidding platform that opens access to its vast last-mile delivery network. The initiative allows businesses to submit proposals to use more than 18,000 destination delivery units and local processing centers across the country.
Steiner said interest has been strong, with more than 1,200 companies and individuals already requesting participation—an encouraging sign for an agency in urgent need of fresh cash inflows.
USPS delivers mail and packages to more than 170 million addresses six days a week, making the last mile the most expensive—and most complex—part of its operation. That cost burden is not unique. Private logistics giants such as FedEx, UPS, and Amazon face similar challenges when it comes to final-mile delivery.
Privatization Not on the Table
Steiner, who assumed leadership in July following a White House-driven leadership change, dismissed the idea of privatizing the Postal Service. He said the scale and cost of nationwide mail delivery make it unattractive for private operators.
“There’s nobody in the private sector that would want the Postal Service,” Steiner said, emphasizing that delivering mail to every corner of the country is an extraordinarily expensive undertaking.
As financial pressures intensify, the latest results make one thing clear: without significant reform, the Postal Service’s long-term sustainability will remain in question.
