U.S. Postal Service reports $6.5 billion fiscal year loss, 11.4% volume decline of marketing mail

The U.S. Postal Service announced its financial results for the 2023 fiscal year ended Sept. 30. The net loss totaled $6.5 billion, compared to net income of $56.0 billion for the prior year. The net income last year was due primarily to the one-time non-cash impact of the Postal Service Reform Act (PSRA) in April 2022 and the results this year were significantly affected by the impact of inflation on operating expenses.

Results under GAAP include retiree benefits expense for the amortization of underfunded Civil Service Retirement System (CSRS) and Federal Employee Retirement System (FERS) plans, and workers’ compensation expenses caused by actuarial revaluation and discount rate changes, as well as the impact of the PSRA for the same period last year. The Postal Service reports its adjusted results excluding these costs.

“Although we are just in the early stages of one of the nation’s largest organizational transformations — which is improving our processing, transportation, and delivery operations — we are already providing more consistent, reliable, and timely delivery to America’s businesses and residences,” said Louis DeJoy, Postmaster General. “We are also addressing near-term financial headwinds relative to inflation as we make strong progress in our long-term cost control and revenue-generating strategies, including launching new products like USPS Ground Advantage. The whole organization is highly focused on implementation of the Delivering for America plan and creating a more effective, efficient and competitive Postal Service to serve the nation far into the future.”

Total operating revenue was $78.2 billion for the year, a decrease of $321 million, or 0.4 percent, compared to the same period last year, as package revenue increases were offset by mail revenue declines.

Revenue for the overall Shipping and Packages category increased $324 million, or 1.0 percent, on a volume decline of 175 million pieces, or 2.4 percent, compared to the same period last year. In July 2023, the Postal Service successfully launched USPS Ground Advantage, a new shipping offering which provides a simple, reliable, and more affordable way to ship packages. First-Class Mail revenue increased $515 million, or 2.1 percent, on a volume decline of 3.0 billion pieces, or 6.1 percent, compared to the prior year.

Marketing Mail revenue decreased $920 million, or 5.8 percent, on a volume decline of 7.7 billion pieces, or 11.4 percent, compared to the same period last year. These decreases were driven by commercial mailers’ increasing use of digital and mobile advertising, an overall decline in advertising spending due to economic pressures, and a higher inflationary environment affecting print media production costs.

Total operating expenses were $85.4 billion for the year, an increase of $5.8 billion, or 7.3 percent, compared to the same period last year. On a non-GAAP basis, adjusted operating expenses increased by $2.1 billion, or 2.6 percent, compared to the same period last year. On a non-GAAP basis, controllable loss was $2.3 billion, compared to controllable loss of $473 million for the prior year.