USPS has reached a deal with Amazon after over a year of negotiations. The agreement is set to cut 20% of Amazon’s shipping volume, according to reports published by The Wall Street Journal.
What to know about Amazon and USPS and Amazon’s new deal
Negotiations started between the USPS and Amazon as a contract between both companies was set to expire in September 2026. Although Amazon said it wanted to strike a deal by December 2025, USPS initially pulled out of negotiations and started a new bidding process for last-mile deliveries.
“Our goal was to increase our volumes with USPS, not reduce them — until USPS abruptly walked away at the eleventh hour in December,” Amazon said at the time, according to Engadget.
After bids with Amazon rivals fell short, USPS re-entered negotiations with the company. In fact, Amazon is the USPS’s largest customers—representing 15% of shipments and accounting for $6 billion in revenue.
During the bidding process, Amazon said it would cut its volume by two-thirds, according to Quartz.
In recent years, USPS has been dealing with financial issues. Since 2007, it has reportedly accumulated $118 billion in net losses. In March, USPS said it needed Amazon to stay afloat as its cash reserves would be exhausted by October.
The new agreement will reduce Amazon’s postal deliveries by 20%
USPS will keep delivering a billion Amazon shipments per year: “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,” an Amazon spokesperson told The Wall Street Journal.
The 20% cut also means USPS could experience a $1 billion loss in revenue. The deal now has to be approved by the Postal Regulatory Commission, which oversees USPS.
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