In the Post

Submitted: Two Sides North America April 30, 2026

The 2025 report from the USPS Office of Inspector General, Comparative Study of International Postal Models (USPS OIG, Feb 2025), compares the Postal Service against 25 foreign postal operators, examining how different regulatory frameworks, business freedoms, and strategies are affecting financial sustainability.  

While the Postal Service works to meet universal service obligations (USO) with the constraints of mandated delivery times, limited diversification, and stricter pricing regulations, many of the foreign posts have less stringent delivery schedules and commercial constraints, have more diversified revenue streams, and draw from government funding to meet their USO commitments.  

The bottom line: A challenging postal market is shared by both the U.S. Postal Service and many of its international counterparts. Postal services that have been structured for diversification, whether in the parcel and logistics sector or other business areas, are currently better able to offset mail profitability challenges. 

Top Takeaways

Universal Mail Decline  

Mail volumes are declining globally. U.S. Market-Dominant mail has dropped by approximately 50% from its historic 2006 peak. Globally, letter mail revenue fell from 50% of postal revenue in 2005 to an estimated 29% in 2025. 

Widespread Financial Losses 

Nearly half of all postal systems in the sample, including USPS, reported losses in 2023. Average industry profitability dropped from +1.4% in 2019 to -0.4% in 2023. 

USPS Is Among the Least Diversified 

94% of USPS revenue comes from mail and parcels. Foreign posts that diversified into banking, insurance, and logistics (e.g., Poste Italiane, Japan Post) are significantly more profitable. 

Constrained Borrowing Capacity 

USPS’s $15 billion debt cap, unchanged since 1992, limits capital investment. Its CAPEX-to-revenue ratio (2.4%) was roughly half Canada Post’s (6.1%), hampering modernization. 

Pension & Retirement Cost Burden 

USPS cannot diversify its retirement asset investments (restricted to U.S. Treasury securities), unlike foreign posts that use diversified market portfolios. The Retiree Health Benefits Fund is projected to be depleted by FY 2031. 

Regulatory Constraints on Pricing & Delivery 

100% of USPS mail volume falls under a price cap, which is stricter than most peers’. The USPS is one of only four countries mandating six-day delivery, while competitors have moved to five-day, alternate-day, or reduced-rural delivery to cut costs. 

Insufficient Government Funding Nine countries fund their postal USO at 2–8% of revenue. USPS, meanwhile, receives less than 0.1% of its revenue in government appropriations, despite USO costs exceeding monopoly value by $2.4 billion in FY 2023. 

E-Commerce Competition  

Rising competition from private parcel carriers is squeezing delivery margins while simultaneously driving parcel volume, highlighting the need for heavy infrastructure investment that USPS struggles to fund. 

Strategic Plan Lacks Financial Detail 

The Office of the Inspector General (OIG) notes USPS’s Delivering for America 2.0 plan lacks specific timelines and financial projections, creating uncertainty about the path to long-term sustainability. 

While the report highlights the complex challenges faced by the USPS, it does not propose changes or solutions. The incoming Postmaster General, David Steiner, has been charged with charting a path forward. With investment, ingenuity, and incentives to increase mail volume, the USPS can continue as an essential institution for all Americans. 

About Two Sides North America

Two Sides North America is a member-supported non-profit advocacy organization for the paper, paper-based packaging, direct mail and graphic communications industries. Our goal is to dispel common environmental misconceptions and to inspire and inform businesses and consumers with engaging, factual information about the environmental sustainability and value of print, paper, and paper-based packaging. We are the only group working to dispel and remove Greenwashing language used by companies and organizations in North America.

To learn more about Two Sides North America and how to become a member, please visit our membership page.

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