#United States #Washington #USPS #Postal Service #David Steiner

U.S. Postal Service's Fiscal Year 2025 Results Overview

On November 14, 2025, the U.S. Postal Service (USPS) unveiled its financial results for the fiscal year ending September 30, 2025. The outlined figures indicate ongoing challenges coupled with some positive developments in its revenue streams. Operating revenue reached $80.5 billion, marking a 1.2% increase from the prior year largely attributed to the growth of the USPS Ground Advantage service and strategic price adjustments.

Despite the increase in operating revenue, the Postal Service reported a net loss of $9 billion, a slight decrease from the previous year's loss of $9.5 billion. The ongoing losses are impacted by a combination of uncontrollable expenses and the challenging environment for package deliveries. The USPS reported a controllable loss of $2.7 billion, extending from a loss of $1.8 billion in the previous fiscal year, thereby underscoring the need for reforms in its regulatory and operational structures.

Factors Impacting Financial Performance

• - Revenue Growth: The operational figures show various dynamics across service categories:

- First-Class Mail revenue grew by $370 million despite a volume decline of 2.2 billion pieces (5.0% decrease).
- Marketing Mail revenue showed a $350 million increase despite a 1.3% drop in volume.
- The Shipping and Packages segment, which is critical for future growth, generated an additional $315 million in revenue although it also faced a volume decrease (5.7%).

• - Costs and Expenses: Total operating expenses reached $89.8 billion, with the rise largely attributed to increased labor costs and operational-related expenses due to retirement incentives offered to employees. Despite efforts to control costs, new challenges, including a $1.7 billion rise in compensation and benefit costs, dampened overall profits. However, noteworthy reductions in transportation expenses of $422 million were recorded, driven by optimization strategies across the USPS network.

Postmaster General's Insights

In reflecting on the results, Postmaster General David Steiner highlighted the stark imbalance between revenue and costs, urging for innovations in revenue generation and changes in public policies affecting the USPS's ability to operate efficiently. Steiner emphasized that while there were moments of financial progress, such as a profitable first quarter, these were overshadowed by systemic challenges necessitating reassessment of the business model.

Future Outlook and Strategic Reforms

To navigate through its operational challenges, the Postal Service is actively pursuing administrative and legislative reforms. These include:

• - Amending pension funding rules for retiree benefits to alleviate financial burdens.
• - Diversifying pension assets to improve financial outcomes.
• - Lobbying for adjustments to the statutory debt ceiling to allow for better financial maneuverability.
• - Seeking reforms in the administration of workers' compensation programs.

The Postal Service remains focused on leveraging its USPS Ground Advantage offerings, enhancing operational efficiencies, and formulating new products to stimulate growth in accordance with evolving consumer demands and market conditions. As it approaches its 250th anniversary, the USPS aims to not only sustain its service mandate but also maintain its status as a trusted American institution.

Conclusion

The financial results of FY 2025 reveal a complex picture for the USPS, characterized by slight revenue growth, significant losses, and a strong demand for strategic reforms. As it strives for financial sustainability, there lies a prevailing challenge to adapt its services and operations in alignment with both market trends and consumer expectations. The future will demand innovative approaches and cohesive policies to ensure that the USPS continues to fulfill its vital public mission effectively.