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The U.S. Postal Service (USPS) reported a net loss of $9 billion in the fiscal year 2025, marking a slight improvement from the prior year. To address ongoing financial challenges, USPS is calling for reforms and new revenue opportunities while implementing operational changes to optimise costs.
USPS Financial Report for Fiscal Year 2025
As reported by Reuters journalist "Autos & Transportation", the U.S. Postal Service reported a net loss of approximately $9 billion for the fiscal year ending September 30, 2025. This loss shows a reduction from the $9.5 billion net loss recorded in the prior year. Despite this, the USPS has experienced more than $100 billion in cumulative losses since 2007 despite numerous restructuring efforts and legislative changes.
According to the official USPS news release dated November 13, 2025 (), the total operating revenue for the year was $80.5 billion, representing a 1.2 percent increase compared to the previous year. This increase was primarily driven by growth in the USPS Ground Advantage shipping service and strategic price increases across mail and shipping categories.
Operating expenses rose slightly by 0.4 percent to nearly $89.8 billion, mainly due to increased compensation costs and other operating expenses, despite some savings from transportation optimizations and lower workers' compensation expenses. Controllable loss, which excludes some expenses management cannot control, increased to $2.7 billion from $1.8 billion in the prior year.
Reasons Cited for Financial Challenges
The USPS attributes its financial difficulties to several factors, including an 80% drop in first-class mail volume since 1997, as reported by NPR journalist. While package shipments have grown, the revenue from them has not offset the decline in mail volume sufficiently. The Postal Service also noted increased compensation and benefits expenses as contributors to higher operating costs.
Postmaster General Louis DeJoy has stated that proposed changes are necessary to enable USPS to operate more efficiently, grow the business, and ensure long-term viability.
Proposed Reforms and Operational Changes
As outlined by NPR reporting (), USPS has proposed reforms aimed at saving approximately $3 billion annually. These changes involve adjusting mail delivery times and transitioning to a more streamlined regional hub network to improve processing and transportation efficiency. The new network includes regional hubs in cities such as Atlanta, Richmond, and Portland.
The proposals maintain commitments to a maximum five-day delivery for the Ground Advantage program and a maximum three-day delivery for local first-class mail. Importantly, election mail, holiday shipments, and medications will not be affected by these changes, with current delivery speeds maintained or improved for these categories.
Stakeholder Reactions
Reactions to USPS reforms have varied. Democratic Representative Gerry Connolly expressed concerns about proposed service standard reductions, warning they could lead to a detrimental decline in service quality while prices rise (). However, USPS officials stress that about 75% of first-class mail will see no change in service standards and that two-thirds of mail would be delivered within three or fewer days.
USPS leadership underscores that without adopting new revenue models and implementing public policy changes, the current financial trajectory is unsustainable. As noted in a statement covered by Yahoo Finance, the Postal Service insists that correcting financial imbalances requires exploring new revenue opportunities and advancing necessary reforms to its business model.
The US Postal Service continues to face significant financial challenges despite some improvements in revenue and operational efficiencies. The organisation is actively seeking reforms and new revenue structures while maintaining key service standards to secure its future viability. Stakeholder feedback remains mixed as the proposed changes aim to balance cost reductions with maintaining reliable nationwide mail delivery.