USPS In Trouble As Agency Experienced Net Loss Of $9 Billion In Fiscal 2025 - How Will This Affect Holiday Deliveries?

The United States Postal Service (USPS) is mired in a dire financial crisis, suffering a monumental net loss of £5.9 billion ($9 billion) for fiscal year 2025. The blow comes amid a 5.7 per cent plunge in parcel volumes and chronic service delays that have eroded public trust.

As the 2025 holiday shopping surge looms, anxiety is mounting over widespread delivery disruptions that could shatter festive expectations for millions reliant on timely packages and mail.

Postmaster General David Steiner remains steadfast in defending the Delivering for America modernisation plan, dismissing pleas to suspend it amid escalating calls for legislative reforms to combat revenue stagnation and mounting operational costs.

The Depth of USPS's Fiscal 2025 Losses

USPS's fiscal 2025 performance reveals a controllable loss of £1.8 billion ($2.7 billion), up from £1.2 billion ($1.8 billion) in the preceding year, signalling unchecked cost pressures despite efficiency drives. Operating revenue inched forward by £597 million ($916 million) to £52.5 billion ($80.5 billion), largely thanks to robust uptake in the USPS Ground Advantage parcel service and targeted price adjustments.

However, the 5.7 per cent contraction in parcel shipments reflects fierce competition from private couriers and shifting e-commerce dynamics, further straining finances. Over the past 18 years, cumulative deficits have ballooned beyond £65 billion ($100 billion), pushing against the £9.8 billion ($15 billion) statutory debt limit imposed in 2022.

Steiner candidly remarked, 'We cannot cost-cut our way to prosperity... We have to grow,' advocating expansion into last-mile partnerships with businesses and government entities. Fiscal 2026 forecasts predict only a modest £587 million ($900 million) gain, compelling bolder strategies to harness growth opportunities beyond traditional mail.

Modernisation Plan Sparks Controversy

The Delivering for America initiative, a comprehensive ten-year overhaul, channels £26 billion ($40 billion) into processing facilities, logistics networks, and workforce training to reverse decades of decline. Core elements include slowing certain deliveries and hiking select product prices, yet implementation has drawn fierce backlash for exacerbating delays.

Notably, the regional transportation optimisation mandates overnight holds at rural post offices, prompting a bipartisan Congressional Postal Service Caucus letter on 15 October 2025 warning, 'These changes would create additional delays for outgoing mail from predominantly rural areas.' The letter was signed by Representatives Nikki Budzinski, Jack Bergman, Chris Pappas, and Andrew R. Garbarino.

Steiner, appointed on 1 July 2025, rebuffed these entreaties, declaring 'While we may change specific initiatives as we move forward and our execution needs improvement...' Postal advocacy bodies, including the Envelope Manufacturers Association, urge a 'collaborative recalibration,' with president Marie Clarke noting on 14 November 2025, 'The financial losses and ongoing service delays are deeply concerning.'

Echoing grassroots frustration, a 10 November 2025 post on X from verified small business advocate @CultLaser read, 'USPS is notorious for not scanning in items, moving packages slower than normal, and tracking being all but useless' during holidays.

The growing discord underscores the plan's precarious balance between efficiency gains and service equity.

Looming Threats to 2025 Holiday Deliveries

First-class mail on-time delivery slipped to 88.89 per cent in fiscal 2025, down from 89.45 per cent the year before. Households waited an average of 2.5 days for mail amid network strains. USPS counters with bolstered capacity, ramping daily processing from 60 million to 88 million pieces via advanced sorting machines and lobby upgrades, including self-service kiosks.

Nonetheless, fiscal distress threatens to magnify rural delays under the modernisation blueprint, potentially overwhelming facilities during the 1 December to 25 December peak. Anticipated 2026 price escalations—6.6 per cent for Priority Mail and 5.1 per cent for Express—may deter budget-conscious shoppers, compounding volume pressures.

Steiner reassured on 14 November 2025, 'I want to assure all that the Postal Service is more than ready to deliver for the 2025 holiday season,' emphasising partnerships for expanded reach. USPS advises mailing by 17 December via Ground Advantage to ensure arrival by 25 December, yet past seasons' bottlenecks fuel scepticism.