USPS Q3: $2.5 billion net loss
The U.S. Postal Service has announced its financial results for the third quarter of fiscal year 2024 (Apr. 1, 2024 – Jun. 30, 2024).
The net loss for the quarter under generally accepted accounting principles (GAAP) totalled $2.5 billion, compared to a net loss of $1.7 billion for the same quarter last year.
The total operating revenue was $18.8 billion for the quarter, an increase of $191 million, or 1%, compared to the same quarter last year.
GAAP results for the quarter were negatively impacted by$1.4 billion of expenses attributed to the amortization of unfunded retiree pension liabilities, and by a workers’ compensation non-cash expense of $67 million driven by actuarial revaluation and discount rate changes; these factors are not controllable by the Postal Service. Controllable loss, which excludes these factors, was $1.1 billion for the quarter, compared to $860 million for the same quarter last year, as expenses related to network modernization and deferred maintenance and continued inflation increased controllable operating expenses.
Total operating revenue was $18.8 billion for the quarter, an increase of $191 million, or 1.0 percent, compared to the same quarter last year.
Revenue from Shipping and Packages, First-Class Mail and Marketing Mail all increased in the third quarter. Shipping and Packages revenue increased $182 million, or 2.4 percent, on a volume increase of 46 million pieces, or 2.7 percent, compared to the same quarter last year. USPS Ground Advantage, The Postal Service’s shipping offering which provides a simple, reliable, and more affordable way to ship packages, has continued to experience wide adoption and growth in the marketplace.
First-Class Mail revenue increased $125 million, or 2.1 percent, on a volume decline of 370 million pieces, or 3.4 percent, compared to the same quarter last year. Marketing Mail revenue increased $107 million, or 3.1 percent, on a volume decline of 43 million pieces, or 0.3 percent, compared to the same quarter last year.
“We are making solid progress in generating a sustained revenue growth trajectory in our mailing and shipping businesses, which is validation of the product and pricing strategies and network capabilities enabled by our Delivering for America plan,” said Postmaster General Louis DeJoy. “We continue transforming and modernizing our processing, transportation and delivery networks, which will enable the Postal Service to operate more efficiently and effectively and at lower cost. Despite inflationary headwinds impacting our costs, we remain committed to finding a path to return the Postal Service to long-term financial sustainability.”
Total GAAP operating expenses were $21.4 billion for the quarter, an increase of $901 million, or 4.4 percent, compared to the same quarter last year. The overall increase in operating expenses was primarily due to inflationary impacts on compensation costs, retirement costs and other operating costs, partially offset by lower transportation costs.
“We reduced work hours by approximately one million hours reflecting a continuing three-year trend of work hour reductions during the implementation of the Delivering for America plan. This reduction, in conjunction with lower transportation expenses for the quarter, reflects continued progress under the plan,” said Chief Financial Officer Joseph Corbett.
