After two "Forever" postage stamp hikes, the USPS lost nearly $10 billion in 2024
The U.S. Postal Service on Thursday said its annual loss widened to almost $10 billion, although revenue rose slightly after two postage rate hikes this year, part of Postmaster Louis DeJoy's plan to get the postal agency on a better financial footing.
The USPS said it lost $9.5 billion in the fiscal year ended September 30, compared with a loss of $6.5 billion a year earlier. The postal service blamed the wider loss on billions spent on noncash contributions to worker compensation.
Excluding that expense as well as what it described as other "certain expenses that are not controllable by management," the USPS said it would have lost $1.8 billion in fiscal 2024, compared with a loss of more than $2.2 billion a year earlier. Revenue rose 1.7% to $79.5 billion in the most recent fiscal year.
The USPS is in the midst of a 10-year overhaul engineered by DeJoy, who has argued that higher postal rates and other changes are essential to staunch the postal service's financial bleeding. Under his original plan, the USPS had aimed to turn a profit in fiscal 2024, but instead, the agency has now reported mounting losses for two consecutive years, raising questions about the effectiveness of the turnaround effort.
DeJoy said the agency is focused on reducing its costs, but that it is also dealing with "many economic, legislative and regulatory obstacles for us to overcome."
The USPS has raised postage rates twice in 2024, with a two-cent per stamp increase in January and a second boost in July, which raised the cost of a Forever stamp to 73 cents.
Fewer deliveries
Mail volume declined in the most recent fiscal year, although revenue increased due to the higher postage rates, the USPS said. It delivered 112 billion pieces of mail, magazines, packages and other items last year, a decline of 3.2% from the prior fiscal year, it said in a financial report.
Keep US Posted, an advocacy group of newspapers, magazines and other companies that rely on the USPS, described the agency's $9.5 billion loss as "staggering," and said it was $3 billion higher than expected. The group also blamed the rate hikes for driving customers away from the USPS, reducing mail volume.
"The bottom line is that these consistent financial losses are driven by stamp hikes which lead to disastrous mail volume losses, plus the complete failure of USPS to capture parcel market share in already crowded package delivery space," said Keep US Posted executive director Kevin Yoder in a statement.
Yoder, a former Republican Congressman from Kansas, also criticized the USPS for focusing on packages rather than traditional mail delivery, which he said remains the largest revenue generator for the postal service.
