Postal woes continue as USPS racks up $2.1 billion loss in second quarter
Service continues to struggle with migration of mail to electronic alternatives, while parcel volumes rise.
The U.S. Postal Service (USPS) is continuing its efforts to return to profitable operations after posting a net loss of $2.1 billion for its second quarter, and plans to pursue "aggressive management actions and legislative and regulatory reforms," the agency said today.
The USPS reported total revenue of $17.5 billion for the second quarter of its fiscal 2019 year (covering the dates Jan. 1 to March 31) for a slight decrease of $8 million, which was "essentially flat" compared to the same quarter last year, USPS said. Meanwhile, the service's operating expenses rose 4.0 percent over the same period last year, rising by $751 million to reach $19.6 billion for the quarter.
Some of that imbalance was driven by the same changes that USPS has seen in recent quarters, as both consumers and businesses use decreasing volumes of postal mail and increasing amounts of e-commerce parcels.
"We continue to face challenges from the ongoing migration of mail to electronic alternatives, and we are legally limited under current law in how we can price our products and streamline our legacy costs," USPS Chief Financial Officer and Executive Vice President Joseph Corbett said in a release. "Within the framework of our current business model, we are executing to grow revenue and reduce operating expenses."
In the most recent quarter, USPS saw its first-class mail revenue drop by $217 million, or 3.3 percent, and its marketing mail revenue sink by $155 million, or 3.9 percent, while shipping and packages revenue rose by $253 million, or 4.9 percent, compared to the same quarter last year.
Despite the persistent drop in mail revenue, that type of missive is still by far the most common type delivered by the USPS. Measured by volume for the second quarter, the service handled 14.2 billion pieces of first-class mail, 17.6 billion pieces of marketing mail, and just 1.5 billion pieces of shipping and packages.
"The Postal Service continues to pursue aggressive management actions and to seek legislative and regulatory reforms to address our overall cost structure and enhance revenue-generating opportunities," Postmaster General and CEO Megan J. Brennan said in a release. "Our focus remains on meeting the expectations of the American public, continuing to invest in the future of the organization, and continually delivering innovations and increased value for both the senders and receivers of mail and packages."
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