The U.S. Postal Service ended its second quarter with a $1.9 billion net loss thanks to the national economic contraction and increased use of faster, cheaper alternatives to traditional mail. Despite deep cuts in costs and work hours, the service still expects a $1.5 billion cash shortfall by the end of its fiscal year in September.
“The economic recession has been tough on the mailing industry, and we have seen an unprecedented decline in mail volumes and revenue that continued to accelerate during the second quarter,” Postmaster General John Potter said during USPS Board of Governors meetings today in Washington. “We are aggressively realigning our costs to match the lower mail volumes, while also maintaining the high level of service and reliability our customers expect. We are also taking a number of steps to grow revenue.”
Those steps could prove tricky, since USPS has lost money in 10 of the last 11 fiscal quarters. Worse, mail carriers delivered only 43.8 billion pieces of mail in the second quarter, down by 7.5 billion pieces, or 14.7 percent from the the same time last year.