Amazon’s Potential Breakup with USPS: What it Means for Online Retail

Amazon Considers Ending Partnership with USPS

After more than three decades of collaboration, Amazon is contemplating severing ties with the United States Postal Service (USPS) to expand its own delivery network, as reported by The Washington Post. Negotiations between Amazon and USPS Postmaster General David Steiner, appointed by former President Trump, have reportedly hit a standstill, prompting Amazon to consider ending the partnership altogether.

Washington Post journalist Jacob Bogage highlighted on Bluesky that Amazon’s preferred course of action was not to discontinue the collaboration. Bogage mentioned that Amazon aimed to extend its contract with USPS, slated to conclude on October 1st, 2026. However, USPS intended to opt for “auctioning off last-mile delivery contracts” instead.

Amazon’s spokesperson, Steve Kelly, stated to The Verge, “We’ve continued discussions to prolong our partnership, aiming to enhance our collaboration that commenced over three decades ago.”

Although Amazon’s decision to part ways with USPS is not definitive, the company would only proceed with expanding its internal delivery network if an agreement to extend the USPS contract cannot be reached. Amazon has acknowledged USPS as its “first and oldest business partner,” contributing $6 billion in revenue to USPS in 2025, constituting about 7.5% of USPS’s total revenue.

Should Amazon transition away from USPS, its in-house delivery system would rival that of USPS. According to Pitney Bowes, Amazon managed 6.3 billion parcels in 2024, trailing only USPS with 6.9 billion, and is projected to surpass USPS by 2028, shipping an estimated 8.4 billion packages compared to USPS’s 8.3 billion.

Amazon’s Steve Kelly expressed, “The USPS is a longstanding and trusted partner, and we are committed to our collaboration. We were taken aback by their auction proposition after nearly a year of negotiations, adding uncertainty to our delivery network. We are exploring all options to ensure seamless service for our customers.”