The USPS implemented surge-pricing during the 2020 holiday season that helped it grow revenue in the last three months of the year – its first quarter of fiscal year 2021 ending September 30.
The US Postal Service reported 25% year-over-year growth in Shipping and Package volumes to 435 million pieces, while sales grew 42.1% to $2.8 billion.
The temporary holiday rate hike was in effect for all commercial domestic competitive packages from October 18 through December 27, 2020, impacting Priority Mail, First-Class Package Service, Parcel Select, and Parcel Return Service.
The USPS said its largest sales category, Mail Services, continued to decline during the first quarter, despite record Political and Election Mail volumes associated with the general election.
- Compared to the same quarter last year, Marketing Mail revenue declined by $246 million, or 5.6%, on a volume decline of 788 million pieces, or 3.9%.
- First-Class Mail revenue decreased by $177 million, or 2.7%, on a volume decline of 594 million pieces, or 4.1%, compared to the same quarter last year.
Today’s earnings release noted the pressure throughout the peak season that the broader shipping sector faced on service performance. (It wasn’t just us, in other words.) But while other shipping carriers put certain limits on large customers, “the Postal Service uniquely accepted all incoming packages, further straining its system,” it stated.
Contributing to the pressure it faced were employee shortages due to the ongoing surge in COVID-19 cases and ongoing capacity challenges for moving historic volumes of mail.
Postmaster General and CEO Louis DeJoy said of the latest quarterly results: “While our positive financial results this quarter are certainly welcome, we continue to face systemic imbalances that make our current operating model unsustainable, and the economic impacts of the COVID-19 pandemic will continue to challenge the organization.”
DeJoy said comprehensive reforms were essential.
Reform is also on legislators’ minds. Five United States representatives and two senators announced the reintroduction of the USPS Fairness Act, which it called “bipartisan legislation to provide the United States Postal Service (USPS) much-needed financial relief by ending the agency’s burdensome prefunding mandate on future retiree health benefits.”
The full quarterly press release is available on the USPS.com website.