The US Postal Service has reported total revenue of approximately $18.9 billion for the second quarter of fiscal 2021. This represents an increase of approximately $1.1 billion, or 6% compared to the same quarter last year.
As a result of the Covid-19 pandemic, as well a continuing decrease in mail volumes, the Postal Service’s sales from mail services, (its largest sales category), continued to decline during the second quarter. Compared to the same quarter last year, Marketing Mail revenue declined by $511 million, or 13.7 percent, on a volume decline of approximately 2.3 billion pieces, or 13.5 percent. First-Class Mail revenue decreased by $390 million, or 6.1 percent, on a volume decline of approximately 1.1 billion pieces, or 7.9 percent, compared to the same quarter last year.
Shipping and Packages Increase
Meanwhile, to no one’s surprise, the Postal Service’s sales from Shipping and Packages increased by approximately $2.0 billion, or 33.6 percent, on a volume increase of 376 million pieces, or 25.3 percent, compared to the same quarter last year, as a result of the surge in e-commerce associated with the COVID-19 pandemic. And as we all know this trend is expected to continue at least through the end of calendar year 2021 and beyond.
In addition, service performance improved in the 2nd fiscal quarter, and service improvements are continuing. USPS also anticipates ongoing network infrastructure investments, such as the installation of new package processing equipment, will meet customer’s evolving needs ahead of the 2021 Peak Holiday Shipping Season.
Delivering for America 10-Year Plan
“The financial results for the quarter and the ongoing trend of declining mail volume and increasing package volume highlights why our “Delivering for America 10-year plan” needs to be fully implemented,” said Chief Financial Officer, Joseph Corbett. “The plan delivers the framework for us to better innovate to grow revenue, work more efficiently and achieve financial sustainability to fulfill our universal service mission. If the plan is implemented in its totality, we expect to achieve break-even operating performance over the ten-year period and positive net income by FY2023 or FY2024, reversing $160 billion in projected losses over the next decade.”
Excluding non-cash workers’ compensation adjustments, total operating expenses were approximately $20.6 billion for the quarter, an increase of $872 million, or 4.4 percent, compared to approximately $19.7 billion for the same quarter last year. Actual total operating expenses, including the non-cash workers’ compensation adjustments, were approximately $19.0 billion for the quarter, a decrease of approximately $3.4 billion, or 15.1 percent, compared to the same quarter last year.
Compensation and Benefits
Compensation and benefits expense increased by $517 million, or 4.4 percent, compared to the same quarter last year, primarily resulting from higher work hours associated with the package volume growth, contractual wage increases and an increase in paid leave associated with the COVID-19 pandemic.
The USPS is serious about its ability to become a major player in the minds of parcel shippers, and not a second tier choice, as they had been associated with in the past.
Are you shipping with USPS? Contact us today to learn how we can support your shipping with USPS.
to receive our FREE white papers: