Amazon.com (NASDAQ: AMZN) plans to reduce the number of packages it ships through the U.S. Postal Service by at least two-thirds by fall 2026, according to reporting from The Wall Street Journal, citing sources familiar with the matter. The reduction will coincide with the expiration of Amazon's current contract with USPS this fall.

The e-commerce company has already begun decreasing its postal volume. USPS delivered more than one billion packages for Amazon last year, representing close to 15% of all packages delivered by the Postal Service nationwide.

The planned reduction could cost USPS millions of dollars in revenue. Amazon has been the Postal Service's largest customer, and its guaranteed volumes have provided stability for the agency, which has operated at a loss for most of the past two decades. USPS reported a net loss of $9 billion in fiscal 2025.

The Postal Service has invested in expanding its parcel-delivery capacity in recent years, constructing larger facilities and purchasing new package-processing equipment to replace aging machinery designed for letter mail. The potential decline in Amazon volumes could result in under-utilization of this new infrastructure and equipment.

If the volume reduction materializes as planned, USPS may need to identify additional cost-cutting measures to manage the financial impact of losing a significant portion of its package delivery business.