Amazon has surpassed the US Postal Service to become the largest domestic parcel carrier in the United States by volume, according to new data from ShipMatrix.
The milestone reflects more than just Amazon’s scale in e-commerce. It signals a deeper transformation in the parcel market, where traditional carriers are stepping back from some of the most commoditized delivery segments while newer and alternative networks gain share.
Amazon handled 6.7 billion parcels in 2025, up 9.8% year over year. The US Postal Service delivered 6.6 billion pieces, down 8.3%, while UPS also posted an 8.3% decline to 4.4 billion deliveries. FedEx moved 3.6 billion parcels, up 5.9%.
Amazon’s growth is no longer driven solely by its own marketplace activity. The company is increasingly handling delivery volume for third parties that do not necessarily sell through Amazon’s platform, reinforcing its position as a logistics player in its own right.
At the same time, alternative carriers are growing quickly. ShipMatrix said their combined volume rose 13% to 2.6 billion units, highlighting the continued expansion of delivery networks operated by retailers, specialists and startup players such as UniUni, Veho, Gofo, Jitsu, SpeedX, OnTrac and Better Trucks.
This shift is happening as UPS and FedEx continue to narrow their focus. Both companies are moving away from lower-margin residential last-mile delivery of lightweight e-commerce parcels and concentrating instead on higher-value services — including heavier shipments, B2B logistics and more complex delivery profiles.
The logic is financial. Commodity last-mile delivery does not generate enough return to justify the cost structure of operating global integrated networks. So the major express carriers are consolidating facilities, trimming capital spending and prioritizing shipments that offer higher revenue per parcel.
Still, that strategy comes with a challenge. Business-to-consumer deliveries represent 75% of the parcel market, while B2B now accounts for only 25%. That means the higher-margin segment is also the smaller one.
The geography of parcel delivery is also changing. Delivery distances have shortened as Amazon and other fulfillment players have moved inventory closer to end consumers. USPS’s Parcel Select product, for example, often travels less than 150 miles, and many e-commerce shippers now use multiple regional fulfillment locations to speed delivery and reduce transport costs.
In revenue terms, UPS still leads the market. The US parcel sector generated $196 billion in revenue in 2025, up 4.1% year over year. UPS led with $58.3 billion, followed closely by FedEx at $57.1 billion. Amazon Logistics and USPS generated $38.5 billion and $32.5 billion, respectively.
ShipMatrix expects the market to continue growing at a 3.9% compound annual rate through 2028, reaching 26.8 billion parcels. That outlook is being supported by leaner store inventories, rising direct-to-home fulfillment and more effective digital tools that convert browsing into purchase activity.
