If you work for USPS, you’ve probably heard some version of “the Postal Service is losing money” for years. But what does the USPS financial health picture actually look like right now? The latest numbers show an organization still under significant financial pressure, with billions in quarterly losses and difficult decisions involving cash and retirement-related obligations.
The Numbers
USPS has reported a net loss in each of the first three quarters of fiscal 2026:
| Fiscal 2026 quarter | Net loss |
| Q1 | Nearly $1.3 billion |
| Q2 | $2.0 billion |
| Q3 | $2.5 billion |
The year-over-year picture is somewhat better in Q2 and Q3. The Q2 loss was $1.3 billion smaller than the same quarter a year earlier, while the Q3 loss improved by $562 million.
Revenue has also increased in recent quarters. Operating revenue rose 2.3% in Q2 and 6.1% in Q3. But those gains haven’t been enough to eliminate the deficit.
USPS’s fiscal 2026 financial plan projects an $8.1 billion net loss for the year, following a $9 billion loss in fiscal 2025.
The Cash Problem
The USPS financial health picture goes beyond quarterly losses.
The Government Accountability Office has kept USPS on its High-Risk List for financial viability since 2009. GAO has warned about the Postal Service’s cash position and long-term financial obligations, including the possibility that USPS could run out of operating cash as early as fiscal 2026 if it made all required payments toward its unfunded liabilities in full.
That concern became more tangible in April 2026, when USPS announced a cash-conservation plan that temporarily suspended its employer payments to the defined-benefit portion of FERS.
USPS said the move would conserve approximately $2.5 billion during fiscal 2026.
It’s important to distinguish that from the TSP. USPS said it would continue withholding employees’ own FERS contributions and sending them to OPM. It also said it would continue making its automatic and matching TSP contributions.
So the April decision did not mean USPS stopped matching employees’ TSP contributions. It involved the employer payments associated with the defined-benefit portion of FERS.
Why the Financial Problems Persist
USPS has struggled with financial losses for years. Mail volume has declined, while labor, transportation, and other operating costs remain substantial.
The Postal Service’s Delivering for America plan is intended to improve its financial position through cost reductions, revenue growth, pricing changes and operational reforms.
There are some signs of progress. Revenue has improved in some areas, certain expenses have declined, and some quarterly losses are smaller than they were a year earlier. But the overall numbers remain difficult.
An $8.1 billion projected annual loss, significant unfunded obligations, and the need to take extraordinary steps to preserve cash all point to a financial problem that isn’t going away quickly.
What Postal Employees Should Watch
For postal employees, the USPS financial health question is about more than whether the next quarterly report shows a profit or loss.
Pay attention to:
- Quarterly losses and operating revenue
- USPS cash and liquidity
- Future changes to FERS employer payments
- Continued TSP automatic and matching contributions
- Staffing and operational changes
- Facility and service changes
- Congressional action affecting USPS finances
USPS has made progress in some areas, but the Postal Service remains under significant financial pressure.
For employees, that makes the USPS financial health story worth watching, not because every quarterly loss automatically changes their retirement benefits, but because the financial decisions USPS makes now could affect the organization and its workforce for years to come.
