The USPS's downward spiral continued in May as a preliminary report [1] filed with the PRC indicates a $677 million net loss for the month and a 20 percent drop in overall volume.

Year-to-date losses total $3.4 billion.

For the current period, the USPS was able to reduce total operating
expenses by almost 7 percent, with transportation taking a 16 percent
hit against same period last year.

Total workhours were reduced by 12 percent versus same period last
year. City delivery workhours decreased by 10 percent, rural by 8.3
percent. Mail processing and customer service/retail workhours were
reduced by 16 and 17 percent respectively.

Expense reduction did little to stem losses. Volume was down 20
percent for the month against May 2008, 13 percent year-to-date.
Periodicals volume declined 13 percent for the period, 7 percent YTD.

Interest expense shot up a whopping 577 percent to 9 million, $3
million more than planned for the period. Though this expense is up 8
percent YTD.

In an effort to help mailers with cost control and drive more
volume, the USPS recently began exploring ways to reduce the cost of
"ride-alongs"—non-periodical items that are bundled and mailed with a
magazine.  

Access the USPS reports filed with the PRC here [2].