By David Shepardson and Jacob Bogage
WASHINGTON, April 6 (Reuters) – Amazon.com on Monday announced it reached a new agreement with the U.S. Postal Service on package deliveries, and sources said the cash-strapped mail system would retain about 80% of its existing deliveries from its biggest customer.
That 20% cut is a dramatically better outcome for the postal agency than the two-thirds or larger reduction that Reuters reported last month Amazon had threatened.
USPS warned last month it could run out of cash as soon as October, and the risk that Amazon would replace the carrier by expanding its own delivery network or using rivals was an existential peril.
Amazon will continue its delivery expansion but short of growth that would rival USPS’s address-by-address reach, the sources said.
Reuters first reported the deal.
USPS has a roughly $80 billion budget, and Amazon represented $6 billion in annual revenue to the agency, according to two people familiar with the business arrangement.
“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.
USPS did not immediately comment. U.S. Postmaster General David Steiner told Reuters in December that USPS delivered about 1.7 billion packages annually for Amazon.
Amazon had criticized USPS plans to auction off access to its last‑mile delivery network. In April 2025, Amazon said it would spend more than $4 billion to expand its U.S. rural delivery network by the end of 2026.
USPS said last month that it was seeking approval for a temporary 8% price hike for priority mail and package deliveries, effective April 26, to deal with rising transportation and fuel costs.
Steiner said in March hiking the price of a first-class stamp to 95 cents from the current 78 cents would help USPS cut losses.
USPS has reported net losses of $118 billion since 2007 as first-class mail, its most profitable product, has fallen to its lowest volume since the late 1960s.
(Reporting by David Shepardson and Jacob Bogage; Editing by Chris Sanders and Cynthia Osterman)
