USPS Reports Fiscal Year 2017 Results

  • Volume for primary source of revenue – letter mail – declines by 5.0 billion pieces
  • Continued aggressive management actions along with postal reform legislation & regulatory changes critically needed to address declining volumes and changing mail mix

WASHINGTON — The U.S. Postal Service reported revenue of $69.6 billion for fiscal year 2017 (October 1, 2016 – September 30, 2017), a decrease of $1.8 billion compared to the prior year. The lower revenues were driven largely by accelerated declines in First-Class and Marketing Mail volumes.


In 2017, mail volumes declined by approximately 5.0 billion pieces, or 3.6 percent, while package volumes grew by 589 million pieces, or 11.4 percent, continuing a multi-year trend of declining mail volumes and increasing package volume. While mail volume declines for the year were somewhat offset by growth in package volume, overall volume has declined by 4.9 billion pieces.

The growth in our Shipping and Packages business provided some help to the financial picture of the Postal Service as revenue increased $2.1 billion, or 11.8 percent. However, that growth was offset in our financials by the decline in mail volumes discussed above, as well as a $1.1 billion 2016 noncash change in accounting estimate and the 2016 roll-back of the exigent surcharge mandated by the Postal Regulatory Commission which further reduced revenue by $1.1 billion from what it otherwise would have been.

“Our financial situation is serious, though solvable,” said Postmaster General and CEO Megan J. Brennan. “There is a path to profitability and long-term financial stability. We are taking actions to control costs and compete effectively for revenues in addition to legislative and regulatory reform. We continue to optimize our network, enhance our products and services, and invest to better serve the American public.”

Brennan stressed that the path forward for a financially stable future must also include urgent actions needed outside of the Postal Service’s control. They include advancement and passage of the postal reform provisions contained in H.R. 756 in the 115th Congress and the adoption by the Postal Regulatory Commission of a new pricing system as part of its 10-year pricing review, enabling the Postal Service to generate sufficient revenues to cover our costs.

Operating expenses for the year were $72.2 billion, a decrease of $4.7 billion, or 6.1 percent, compared to the prior year, although this net reduction was largely attributable to changes in actuarially determined expenses outside of management’s control.  Expenses for retiree health benefits and workers compensation declined by $4.8 billion and $3.5 billion, respectively, but were partially offset by $2.4 billion in higher expenses for the amortization of unfunded retirement benefits, the result of statutory mandates effective for 2017 and changes in Office of Personnel Management actuarial assumptions. Expenses for compensation and benefits and transportation also added $667 million and $246 million, respectively, to 2017 operating expenses.

The Postal Service reported a net loss for the year of $2.7 billion, a decrease in net loss of $2.8 billion compared to 2016. Of this decline in net loss, $2.4 billion was the result of changes in interest rates, outside of management’s control, that reduced workers’ compensation expense compared to last year.

The controllable loss for the year was $814 million, a change of $1.4 billion, driven by the $775 million decline in operating revenue before the 2016 change in accounting estimate, along with the increases in compensation and benefits and transportation expenses of $667 million and $246 million, respectively.

Similar to the last several years, the Postal Service was unable to make any of the payments that were due to the federal government at the end of the fiscal year, which amounted to approximately $6.9 billion in 2017, to pre-fund pension and health benefits for postal retirees.

“Making the payments to the federal government in full or in part would have left the Postal Service with insufficient liquidity to ensure that we will be able to cover our current and anticipated operating costs, make necessary capital investments, and absorb any contingencies or changes in the marketplace,” said Chief Financial Officer and Executive Vice President Joseph Corbett. “We will continue to prioritize the maintenance of adequate liquidity to ensure the Postal Service is able to perform our primary mission of providing universal service to all Americans.”

FY 2017 Operating Revenue and Volume by Service Category Compared to Prior Year
The following presents revenue and volume by service category for the year ended September 30, 2017, and 2016:



(revenue in $ millions; volume in millions of pieces)





Service Category
First-Class Mail $






Marketing Mail





Shipping and Packages




















Total before change in accounting estimate







Change in accounting estimate $



Total operating revenue and volume $








2016 Change in Accounting Estimate
During the third quarter of fiscal year 2016, the Postal Service revised the estimation technique utilized to determine its Deferred revenue-prepaid postage liability for a series of postage stamps. The change resulted from new information regarding customers’ retention and usage habits of Forever Stamps, and enabled the Postal Service to update its estimate of usage and “breakage” (representing stamps that will never be used for mailing due to loss, damage or stamp collection).

As a result of this change in estimate, the Postal Service recorded a decrease in its Deferred revenue-prepaid postage liability as of June 30, 2016, which caused an increase in revenue and decrease in net loss of $1.1 billion for the year ended September 30, 2016. This change in accounting estimate resulted in a non-cash adjustment that does not impact the Postal Service’s available cash or access to cash and does not affect its controllable loss.

Selected FY 2017 Results of Operations
This news release references operating revenue before the change in accounting estimate and operating revenue before the temporary exigent surcharge, which are not calculated and presented in accordance with accounting principles generally accepted in the United States (GAAP).

The following table reconciles these non-GAAP operating revenue calculations with GAAP net loss for the year ended September 30, 2017, and 2016:

(results in $ millions)



Operating revenue
Operating revenue before temporary exigent surcharge and change in accounting estimate $




Temporary exigent surcharge1


Operating revenue before change in accounting estimate $




Change in accounting estimate2


Total operating revenue $




Other revenue



Total revenue $




Total operating expenses $




Interest and investment income (expense), net



Total expenses $




Net loss $


) $


1 The temporary exigent surcharge expired on April 10, 2016.

2 This change in accounting estimate relates solely to changes in estimates of stamp usage and breakage for Forever Stamps sold from 2011 through June 30, 2016, reflected as a decrease in the Deferred revenue-prepaid postage liability as of June 30, 2016.


Controllable (Loss) Income
This news release references controllable (loss) income, which is not calculated and presented in accordance with GAAP. Controllable income (loss) is a non-GAAP financial measure defined as net income (loss) adjusted for items outside of management’s control and non-recurring items. These adjustments include workers’ compensation expenses caused by actuarial revaluation and discount rate changes, PSRHBF prefunding expenses, the amortization of PSRHBF, CSRS and FERS unfunded liabilities, and the change in accounting estimate.

The following table reconciles the Postal Service’s GAAP net loss to controllable (loss) income and illustrates the loss from ongoing business activities without the impact of non-controllable and non-recurring items for the years ended September 30, 2017, and 2016:

(in $ millions)



Net loss $


) $


PSRHBF supplemental unfunded liability expense1


PSRHBF prefunding fixed amount2


Change in workers’ compensation liability resulting from fluctuations in discount rates



Other change in workers’ compensation liability3



Change in accounting estimate4


CSRS supplemental unfunded liability expense5


FERS supplemental unfunded liability expense6



Change in normal cost of retiree health benefits due to revised actuarial assumptions7


Controllable (loss) income $




1 Expense for the annual payment due by September 30, 2017, on the unfunded liability as calculated by OPM.
2 Expense for the annual prefunding payments to the PSRHBF due on September 30, 2016, and 2015, upon which the Postal Service defaulted.
3 Net amounts include changes in assumptions, as well as the valuation of new claims and revaluation of existing claims, less current year claim payments.
4 This change in accounting estimate relates solely to changes in estimates of stamp usage and breakage for Forever Stamps sold from 2011 through June 30, 2016, reflected as a decrease in the Deferred revenue-prepaid postage liability as of June 30, 2016.
5 Expense for the annual payment due September 30, 2017, calculated by OPM, to amortize the unfunded CSRS retirement obligation as of September 30, 2016, the date of the most recent available information. Payments are to be made in equal installments through 2043.
6 Expense for the annual payment due September 30, 2017, calculated by OPM, to amortize the unfunded FERS retirement obligation as of September 30, 2016, the date of the most recent available information. Payments are to be made in equal installments through 2046.
7 Represents the annual portion of the normal cost payment due September 30, 2017, attributable to revised actuarial assumptions and discount rate changes. The total normal cost payment amount, calculated by OPM, is $3.3 billion.


Complete financial results are available in the Form 10-K, available (after 9 am ET) at

Financial Briefing
Postmaster General and CEO Megan J. Brennan and Chief Financial Officer and Executive Vice President Joseph Corbett will host a telephone/Web conference call to discuss the financial results in more detail. The call will begin at 10:00 am ET on November 14, 2017, and is open to news media and all other interested parties.

How to Participate:
US/Canada Attendee Dial-in: 844-340-4622                Conference ID: 2597149

Attendee Direct URL:

If you cannot join using the direct link above, please use the alternate logins below:
Alternate URL:
Event Number: 993 038 707

The briefing will also be available on live audio webcast (listen only) at:

15 thoughts on “USPS Reports Fiscal Year 2017 Results

  1. they lost 2.6 Billion……..69.6 Billion revenue, 72.2 Billion expense = 2.6 Billion Loss period. would like to see a private sector Big 8 accounting firm come in and do a real GAAP audit………bet the real loss would be mind-blowing. President Trump fire this Obammy holdover Brennen…..she is a loser. Pan American Airlines went out of business when they lost 13 million for the year. Postal Circus lost over 125 Billion since 2009…..stopped paying into pre-funding-how dat? somebody is propping up this malignant cancer cell.


  3. Imagine being able to run a tax-exempt monopoly…. I mean that’s a license to print money!!!
    But these inbred ass clowns still manage to lose billions a year!!! SMH

  4. I just retired in the past 6 weeks. 36 years. Last day at work another employee brought a cake in. Also a card. PO management, 6 of them never came out of their office, never said thanks. Just hid and never acknowledged a career. To top it off, my last paycheck was missing over 8 hours of pay. I’m glad not I’m not working in that toxic environment anymore. I feel for all of you who are still hanging on.

    • Bernie….Same exact thing happened to me. 34 years. But I had an OIC who was a prick and didn’t care about anything but the numbers. But my immediate supervisor came out on my route my last day and apologized. We talked for a while and had me come back the next day to give me a send off. At least he appreciated my service and knew what the right thing to do was.

    • I’m sure the people you served appreciated the years of professional service you provided. We rose above the toxic cesspool that we were subjected to. Thank you.

      • you should really read the article, they did not pay the pre-funding…..they have not paid into pre-funding since 2009…….8 years under bath house barry the place lost $ Billions while they got PFP bonus money…….seems like the typical Demonrat plan of stealing other peoples money! maybe the Clinton Crime Foundation will give the corrupt US Postal Circus a loan lol….me I will keep accumulating UPS, FDX, AMZN stock in my Roth IRA. this place is a money loser that will only get worse, not better.110,000 PO Mismanagement will continue to rip the place off and line their pockets.

  5. Ether extend the prefunding of health care costs to all employers, or end the Postal Services forced prepayment of health care expenses! The prepayment of health care costs forced upon the Postal Service is but a political decision. the current administration is too busy giving tax cuts to the rich, destroying unions, health care, and cuddling gun owners. Don’t expect any progress soon.

  6. The Postal Service needs to be put back “on budget”. PMG Brennan and CFO Corbett need to be replaced. The accounting practices used by them are not acceptable accounting practices. They have given up on meeting their financial obligations. If they can get away with cooking the books any way they want then how how can we trust that any of this report is accurate! HR 756 does not seem to be going anywhere in Congress. Just like it didn’t last year or any previous years.

  7. haven’t our finances been “solveable” for several years now?? and yet nothing changes?? that just seems odd to me

  8. I wonder how many first-class mail pieces were thrown in the garbage purposefully either by management or by instruction thereof as was the case in North Carolina and Tampa. Google, “Is the Postal Service Throwing Away First Class Mail” for a link to a 2-minute video from a Charlotte Fox46 news outlet. Now this from the Figures-Lie-And-Liars-Figure Department, at our plant, a flats machine has been offline since April not getting credit for any mail processed through it. The plan was to have it packed up and shipped off to Texas but we have had to use it every day due to our mail volume. The report filed falsely shows that the AFSM was indeed removed–it has not been. If falsifying mail volume is being done all over the country, it needs to be investigated thoroughly by a team not associated with the USPS.

  9. As long as mgmt continues to receive their bonuses, I don’t want to hear anything about so called financial problems from them.

    More made up numbers, from the liars and thieves.

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