Amazon and the U.S. Postal Service have reached an agreement that will enable the USPS to retain the majority of business from its biggest customer.
Multiple outlets are reporting the deal leaves the USPS with some 80% of Amazon’s package delivery business.
Amazon had earlier been said to be considering a two-thirds reduction.
USPS had issues warning signs it could run out of cash by October. In that event, the danger for USPS was that Amazon would swoop in and replace USPS by expanding its own delivery network.
Amazon will continue its delivery expansion but short of growth that would rival USPS’s address-by-address reach, the sources told Reuters, which was first to report the deal.
“We’re pleased to have reached a new agreement with USPS that furthers our longstanding partnership and will let us continue supporting our customers and communities together,” Amazon said in a statement.
USPS did not immediately comment. U.S. Postmaster General David Steiner told Reuters in December that USPS delivered about 1.7 billion packages annually for Amazon.
According to Reuters, USPS has reported net losses of $118 billion since 2007 as first-class mail, its most profitable product, has fallen to its lowest volume since the late 1960s.
