The U.S. Postal Service announced fiscal 2022 first-quarter results on Tuesday, which included a nearly 10% year-over-year decline in peak holiday season parcel and shipping volume. and a nearly 8% drop in revenue, as delivery demand in the holiday quarter fell from the frenetic peak season of 2020, when more consumers shopped online for the holiday.
Volume for the first quarter of the Postal Service’s fiscal 2022, which covers the last three months of the calendar year, was 1.96 billion pieces, compared to 2.17 billion pieces in the fiscal quarter. 2021. Revenue from shipping and parcel services was $8.6 billion, compared to $9.3 billion in the prior quarter.
First-quarter results were well ahead of the same period two years ago, before the COVID-19 pandemic profoundly altered shopping behaviors and delivery activity. In the first quarter of fiscal 2020, which covered the 2019 holiday season, the Postal Service handled 1.73 billion packages and other non-postal items with revenue of $6.6 billion.
Postal authorities had predicted a general slowdown in e-commerce volumes, as vaccinated Americans increasingly return to in-store shopping year-round. This trend was evident during the holiday season that has just ended.
The shift to more in-store shopping over the past holiday season has likely been more beneficial for the Postal Service than other package delivery carriers, as the Postal Service is required to pick up and deliver from every address in the United States. Fewer online purchases meant fewer costly and time-consuming package deliveries to residences.
The Postal Service’s on-time delivery performance during the 2021 holiday has improved significantly over the 2020 period, when it was hit by unprecedented volumes it could not prepare for, numerous absences due to pandemic and inclement weather at major collection and delivery nodes across the countryside.
According to consulting firm ShipMatrix Inc., the Postal Service met its holiday 2021 delivery goals 96.5% of the time, an improvement of more than 300 basis points from holiday 2020, when it was flooded. unexpected surges from large shippers with volumes limited by FedEx Corp. (NYSE: FDX) and UPS Inc. (NYSE: UPS).
For the first quarter of 2022, the Postal Service reported operating revenue of $21.3 billion, down less than 1% year-over-year. It reported an adjusted loss of $1.3 billion in the quarter, compared to an adjusted loss of $288 million in the prior period. Operating expenses increased nearly 8% year-over-year, with transportation costs increasing 9.2% due to higher fuel costs and an increase in transportation expenses outside fuel.
The one-time adjustments came in the areas of increased workers’ compensation and employee health benefit costs, areas over which the Postal Service has no control. Those expenses rose $1.06 billion from a year earlier due to higher interest charges to fund those obligations, the Postal Service said.
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