A parcel surcharge the U.S. Postal Service (USPS) introduced in April to cover rising fuel and transportation costs, combined with higher stamp prices, pushed fiscal third-quarter operating revenue to $19.9 billion, according to FreightWaves. The surcharge is set to expire on Jan. 17, and the agency has already filed a request to raise stamp rates again in January using a different methodology it says will raise more money.
Postmaster General David Steiner announced the results Friday and criticized the Postal Regulatory Commission for limiting price increases to once a year — a constraint he said cost the agency $700 million in lost revenue, FreightWaves reported. USPS cut its net loss year over year by 18.2%, or $584 million, to $2.5 billion for the three months ended June 30. The controllable loss, which excludes mandated obligations outside management's control, was $1.04 billion.
Parcel surcharge and stamp prices lift revenue
Operating revenue rose 6.1% to $19.9 billion compared with the same period last year, according to FreightWaves. The gains came from higher First-Class and marketing mail stamp prices and the new parcel fees, partially offset by declining mail and package volumes. Steiner also credited higher operating revenues, network optimization that improved service while reducing work hours, and a decrease in workers' compensation costs, even as overall costs increased, FreightWaves reported.
| Metric | Fiscal Q3 2026 (per FreightWaves) | Change |
|---|---|---|
| Operating revenue | $19.9 billion | +6.1% year over year |
| Net loss | $2.5 billion | -18.2% year over year ($584 million improvement) |
| Controllable loss | $1.04 billion | Excludes mandated obligations outside management control |
Network optimization and cash conservation
The integration of distribution centers, technology and equipment is occurring without the glitches of past years, according to FreightWaves. Cash-conservation measures, including deferring payments to employee pension and retirement funds, have given USPS enough liquidity to operate through at least August 2027 — a rollback from the 2031 liquidity cliff Steiner described in his June testimony to Congress.
Steiner reiterated that the quasi-public agency needs legislative and regulatory reforms to operate like a private enterprise and shed onerous statutory obligations for managing pension and retirement funds, FreightWaves reported. The universal mail coverage mandate remains a major structural impediment: mail volumes have declined more than 50% since 2007 while delivery points continue to grow. USPS added 1.8 million new stops last year, and average pieces delivered per stop fell from 5.5 in 2007 to 2.4 pieces in 2025.
"The bottom line is that we need to fix the business model that has produced the 17-year-long imbalance in costs and revenue," Steiner said, according to FreightWaves, later adding, "As we reduce costs and improve revenue, we believe we will become more profitable, and the appropriation could be reduced."
Regulatory friction and the $700 million price cap
Steiner said the Postal Regulatory Commission's decision to limit price increases to once a year cost the Postal Service $700 million in lost revenue, and he argued for more pricing flexibility, FreightWaves reported. "Use of our pricing authority is absolutely necessary to improve our financial sustainability and we need to be given more flexibility if we are expected to cover our costs," he said. USPS recently filed a request to raise stamp rates in January using a different methodology it says will raise more money.
Implications for shippers and logistics operators
The near-term picture for parcel shippers is defined by two dates: the Jan. 17 expiration of the parcel surcharge and a pending January stamp rate increase, according to FreightWaves. Steiner called on Congress to provide temporary investments and eliminate unfunded mandates, and warned that if Congress does not help the Postal Service grow, it will have to consider reducing service levels, closing thousands of post offices and raising prices to break even. FreightWaves reported that Steiner has made revenue growth a priority through more aggressive pricing on letters and bulk mail, and that he aims to maximize total revenue rather than volume alone — applying the same revenue-management principles used by airlines and grocery stores.
Watch list
- Whether the Postal Regulatory Commission approves the January rate filing under the new methodology, and what revenue it generates.
- Whether the parcel surcharge expires as scheduled on Jan. 17 or is extended.
- Any congressional action on temporary investments or unfunded mandates affecting USPS liquidity beyond August 2027.
- Distribution-center integration performance and its impact on USPS service reliability and work hours.
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