The U.S. Postal Service reported a net loss of $9 billion in 2025 and has long operated at a loss while running out of cash. Nearly 15 percent of packages delivered by USPS in 2025 came from Amazon, highlighting the agency's reliance on the e-commerce giant. Even with the planned reduction, USPS is still on track to deliver more than 1 billion packages for Amazon each year.
Amazon has relied heavily on USPS's last-mile service to reach customers in remote and rural areas, where the last mile of delivery accounts for up to 53 percent of a shipment's total cost. To reduce this dependency, Amazon announced last April that it is investing over $4 billion to expand its rural delivery network.
In January, USPS began accepting proposals to use its last-mile delivery network through an auction process meant to raise funds, receiving bids from more than 20 companies. Amazon and USPS's contract is set to expire this October, and Amazon submitted a bid for the USPS auction, hoping to continue its partnership even at a reduced level.
The change in direction follows a new bidding process launched last December by Postmaster General David Steiner. The Postal Service decided to re-engage directly with Amazon after the projected revenue and volume from other bidders didn't meet the agency's needs. The agreement is pending review and approval by the Postal Regulatory Commission.