Amazon Reaches Reduced Deliveries Deal With U.S. Postal Service
Amazon.com said Monday it has reached a new agreement with the United States Postal Service (USPS) on package deliveries, reports Yahoo Finance. Sources told Reuters the deal will result in Amazon, which is USPS's largest single customer, retaining around 80 percent of its existing deliveries with USPS, or more than 1 billion packages per year.
Amazon’s plan to replace the Postal Service with its own nationwide delivery service posed an existential threat to the mail agency, which has a roughly $80 billion budget. The e-commerce giant represented $6 billion in annual revenue for the USPS, according to two people familiar with the business arrangement. Amazon earlier had criticized USPS plans to auction off access to its last‑mile delivery network. The retailer had threatened to cut its delivery business at the cash-strapped Postal Service by at least two-thirds, Reuters reported last month.
Total Retail's Take: A 20 percent reduction in deliveries, while not ideal, is a far better outcome for the U.S. Postal Service than what Amazon had previously threatened. The USPS depends heavily on the e-commerce giant to sustain its budget, as the single retailer is reported to represent around 7.5 percent of the USPS' revenue. U.S. Postmaster General David Steiner told Reuters in December that USPS delivered about 1.7 billion packages annually for Amazon.
"We're pleased to have reached a new agreement with USPS that furthers our longstanding partnership and will let us continue supporting our customers and communities together," Amazon said in a statement.
Amazon has been working to expand its own delivery services network across the U.S., which would further threaten the USPS as it grows. In April 2025, Amazon pledged to spend $4 billion by the end of 2026 to triple the size of its rural delivery network. In June, it announced it would provide same- and next-day Prime delivery to 4,000 smaller cities, towns and rural communities across the country.
- Categories:
- Shipping
- Companies:
- Amazon.com
- United States Postal Service
Kristina Stidham is the digital content director at Total Retail and sister brands Women in Retail Leadership Circle and Women Leading Travel & Hospitality at NAPCO Media. She is passionate about digital media and handles video, podcast and virtual event production for all brands. You can often find her at WIRLC, TR, WLT&H or industry events with her camera and podcasting equipment—or at home on Zoom—recording interviews with thought leaders and business executives.
Kristina holds a B.A. in Media Studies and Production from the Temple University Klein College of Media and Communication in Philadelphia. Go Owls! When she's not in the office, she loves to go on long walks, sing around the house, hangout with her family and two pet guinea pigs, and travel to new places.
