Canada Post Faces Financial Crisis, Seeks Additional Bailout

Canada Post has announced that it will require additional financial assistance by early 2026, as the Crown corporation grapples with significant financial losses. Following a federal loan of $1 billion received in January, the postal service is now on track for its worst fiscal year, reporting the highest quarterly loss in its history. The ongoing challenges include fierce competition in parcel delivery and disruptions due to a prolonged labour dispute.

In its quarterly report released on November 21, 2025, Canada Post indicated that the initial loan of $1.03 billion from the federal government was intended to sustain operations through the fiscal year ending on March 31, 2026. However, the corporation expects to exhaust these funds by December 31, 2025, primarily due to revenue declines caused by strike actions involving its 55,000 mail carriers.

The financial strain has become evident, with Canada Post recording a pre-tax loss of $541 million in the third quarter. This represents an alarming increase of 72 percent from a loss of $315 million during the same period last year. The report highlighted that strike activity and uncertainty have driven customers to seek alternatives for their delivery needs, further exacerbating the corporation’s financial woes.

Declining Revenues and Strategic Changes

Revenue from parcel deliveries, which was the most profitable segment in the previous year, plummeted by 40 percent to $450 million. This drop corresponds with a decline in parcel volume of 27 million pieces. Consequently, sales from the parcel division have now fallen behind those of traditional mail delivery, a sector that has experienced a consistent decrease in letter volume for nearly two decades.

The financial outlook raises critical questions regarding Canada Post’s business model as it faces losses exceeding $5.5 billion since 2018. The ongoing negotiations with the Canadian Union of Postal Workers have stretched beyond two years, creating uncertainty as the peak holiday season approaches.

CEO Doug Ettinger noted at the company’s annual meeting that the postal service anticipates a reduction of up to 30,000 employees over the next decade due to retirements and voluntary departures, as part of efforts to manage costs.

In September, Federal Procurement Minister Joël Lightbound introduced a series of reforms aimed at modernizing Canada Post’s operations. These changes could allow the corporation to modify mail delivery standards, close certain rural post offices, and expand community mailbox services to additional addresses. Earlier this month, Canada Post submitted a proposal to the federal government to capitalize on these reforms, although details will remain confidential during the review process.

In summary, Canada Post faces a challenging financial landscape, marked by substantial losses and increasing competition. The urgency for additional financial support underscores the need for strategic changes as the organization navigates a precarious future.