The United States Postal Service (USPS) reported a net loss of $2.1 billion in the first quarter of the 2024 fiscal year (Oct. 1, 2023 – Dec. 31, 2023). That is a 110% increase over last year when it posted a net loss of $1 billion in Q1 2023.
USPS said that the losses were attributed to “non-cash workers’ compensation expenses due to actuarial revaluation and discount rate changes, the amortization of unfunded retiree pension liabilities, and the continued effect of inflation on operating expenses.”
Total operating expenses were $23.8 billion for the quarter, $1.1 billion (4.9%) higher than last year. However, USPS said that total operating costs would have actually decreased by $218 million if the costs of paying for pension benefits of USPS employees were taken out of the equation. The earnings press release states, “Excluding those costs that we cannot control such as retiree pension 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, adjusted operating expenses decreased by $218 million, or 1.0 percent, compared to the same quarter last year.”
“While our first quarter saw package revenue growth, we continue to see inflation impacting our business,” said Chief Financial Officer Joseph Corbett. “We continue to implement components of the Delivering for America plan working towards financial stability. While full success of the plan will still require Administrative action on the apportionment of certain retiree pension benefit costs, we have been successful in managing the costs within our control, such as reducing work hours by 8 million hours and taking calculated steps to optimize our networks and decrease transportation costs.”
Total operating revenue was $21.6 billion for FY Q1 2024, an increase of $115 million (0.5%) over Q1 2023.
Revenue for Shipping and Packages increased by $240 million (2.7%) over last year and First-Class Mail revenue increased by $171 million (2.6%).
However, Marketing Mail revenue dropped $235 million (5.4%). USPS said that the majority of revenue and volume decreases were associated with political and election mail, which decreased by over $275 million, a reflection of the impact of the 2022 mid-term elections in the first fiscal quarter of 2023. Revenue for Marketing Mail would have increased by $40 million had it not been for the impact of the cyclical mailings associated with the elections.
