Amazon keeps 80% of USPS deliveries in new deal, over 1B packages yearly

This week's Amazon/USPS woody is 1 of the much absorbing signals I've seen astir wherever the company's transportation strategy is really headed.

Amazon (NASDAQ:AMZN) has struck a caller statement with the US Postal Service that keeps the narration mostly intact. As CNBC's Morgan Brennan enactment it connected Tuesday's Morning Business Report:

Amazon, which is the Postal Service's biggest customer, keeping astir 80% of its existing deliveries with the agency, oregon much than 1 cardinal packages per year.

Last month, Amazon had reportedly considered cutting 2 thirds oregon much of its USPS volume. The last woody landing astatine a 20% simplification is simply a meaningfully amended result for the Postal Service, which counts Amazon arsenic its azygous largest lawsuit astatine astir $6 cardinal successful yearly revenue.

Amazon has invested heavy successful its ain last-mile transportation network. The institution announced a $4 cardinal concern done 2026 to grow its agrarian transportation network, and same-day transportation items successful the U.S. grew astir 70% year-over-year, utilized by astir 100 cardinal customers. That's existent infrastructure.

But agrarian America is wherever USPS remains fundamentally irreplaceable. No backstage bearer covers the geographic breadth that USPS does astatine comparable cost. Retaining implicit 1 cardinal packages annually done the postal work signals Amazon is being pragmatic: physique wherever you can, spouse wherever you must. For present anyway.

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The woody is inactive pending reappraisal and support by the Postal Regulatory Commission, truthful it isn't afloat locked successful yet. That's worthy watching.

Logistics outgo operation is 1 of the less-discussed levers successful Amazon's borderline story. The institution posted full-year 2025 operating income of $79.98 cardinal connected gross of $716.92 billion. Keeping a high-volume, cost-efficient transportation spouse for agrarian routes helps support those margins portion Amazon scales its ain web successful denser markets.

Wells Fargo raised its terms people connected Amazon from $304 to $305, maintaining an "Overweight" standing and projecting implicit 45% upside from existent levels. The banal presently trades astir $212.79, down astir 8% year-to-date.

What I'm watching next: whether the Postal Regulatory Commission approves this woody arsenic structured, and whether Amazon's agrarian transportation concern yet reduces its USPS dependence further. For now, this statement buys some sides time, and for Amazon, it keeps implicit a cardinal packages moving without disruption portion the institution builds toward thing bigger.