1. REVENUE


(in millions of units indicated)

Revenue*

Volume(pcs)*

		2002	2001	2002	2001

	First-Class	$36,483.2	54.89%	$35,876.0	54.89%	102,378.6	50.48%	103.655.6	49.96%
	Standard	15,818.8	23.80%	15,704.9	23.86%	87,230.6	43.01%	89,938.4	43.35%
	Priority	4,722.5	7.11%	4,916.4	7.47%	998.2	0.49%	1,117.8	0.54%
	Spec Svcs	2,654.5	3.99%	2,341.4	3.56%	0.0	0.00%	0.0	0.00%
	Periodicals	2,164.9	3.26%	2,205.2	3.35%	9,689.8	4.78%	10,077.4	4.86%
	International	1,579.8	2.38%	1,731.7	2.63%	903.8	0.45%	1,082.5	0.52%
	Express	910.5	1.37%	995.7	1.51%	61.2	0.03%	69.4	0.03%
	Other	2,129.1	3.20%	2,062.4	3.13%	1,559.6	0.77%	1,521.5	0.73%
	Totals	$66,463.3	100.00%	$65,833.7	100.00%	202,821.8	100.00%	207,462.6	100.00%

*  Note: See Pages 52 and 53 of our 2002 Annual Report for Revenue, Volume and Weight     information by Class of Mail.

In 2002, operating revenue grew 1.0 percent to $66.5 billion, on a volume decline of 2.2 percent. This marked the second consecutive year of mail volume decline and the greatest rate of volume decline since 1946. In 1999, revenue grew 4.4 percent with the implementation of a general rate increase. Revenue in 2000 grew 2.9 percent, nearly $800 million below what had been estimated. First-Class Mail volume grew less than expected, mailers shifted their mail to more automated classes to reap associated cost savings, and diversion of messaging from hard copy mail to electronic media continued. These trends strengthened in 2001 and were compounded by the effects of the steadily softening economy. In 2002, continuing economic weakness, the disruptive effects of the September 11 attacks and bioterrorism and the R2001-1 rate increase all contributed to still greater volume decline. The early implementation of R2001-1 rates boosted revenue by almost $1 billion, however, and was the major contributor to the revenue increase. Tables 3-1 and 3-2 show the percentages for revenue and volume by class of mail.