Amazon is preparing to expand its nationwide delivery network and give up its longstanding relationship with USPS, according to The Washington Post sources.
Amazon has recently been in talks with the Postal Service over its negotiated service agreement, hoping to come to a new agreement that would have locked in better rates and set higher benchmarks for package volume, but the talks have stalled.
USPS instead plans to hold a reverse auction next year to make Amazon and other business customers compete for postal capacity — a move that is making Amazon want to pull all of its packages entirely. For reference, Amazon is the Postal Service's top customer, providing more than $6B in annual revenue in 2025 alone, or about 7.5% of its total revenue, so that'd be a big loss! Especially given the fact that even with that contract revenue from Amazon, USPS still posted a $9B loss in the 2025 fiscal year.
Amazon spokesperson Steve Kelly in a statement called the Postal Service a “long-standing and trusted partner” and said the company remained committed to working with the agency, but that Amazon was “surprised to hear” that the Postal Service wanted to run an auction after nearly a year of negotiations.
Kelly added, “Given the change of direction and the uncertainty it adds to our delivery network, we’re evaluating all of our options that would ensure we can continue to deliver for our customers.”
Is the USPS really in the best position to make their top customers bid for their services?
USPS has posted multi-billion dollar losses in 9 of the past 10 years and has faced threats of privatization and de-funding from President Trump since taking office. Then again, it obviously can't keep operating in the same capacity, so perhaps the shakeup will prove to be fruitful in the long run.