Spain's Correos loses €1.16 billion in five years despite online shopping boom

Correos has racked up €1.16 billion in losses while online commerce breaks records

There is one scene that sums up the problem better than any report: a postman drives 30 kilometres of country road to deliver a notification to a hamlet. The sender pays a stamp of just over one euro. That alucinación costs Correos considerably more. The law requires it to reach every corner of the country five days a week at affordable prices, no matter how isolated the property. This is the Universal Postal Service, and the State compensates those loss-making routes. In 2025 that compensation reached €334.5 million. Without that money, the €11.2 million profit of 2025 would have been a hole of hundreds of millions.

E-commerce grew 20.6% last year to nearly €115 billion. The big beneficiary has not been the public operator, but the large private parcel companies. In 2025 Correos handled just 1.06 billion items, the lowest in its historical series: 76% fewer than at the start of the last decade and less than half of the 2019 figure. Since then it has accumulated more than €1.16 billion in losses, multiplied its debt more than 60-fold and lost almost 8,600 workers.

Parcels have not inherited the letter's profitability

The parcel has replaced the letter, but it has not inherited its profitability. Mail was a volume business: each route carried many items and delivery costs were spread across all of them. Parcels require larger vans, more fuel and more staff. And in that market Correos faces giants like Amazon, DHL or Seur in a price war that squeezes margins to the limit.

That is why parcels account for barely 40% of Correos' revenue, €837 million last year. A figure not enough to sustain a network of more than 8,000 offices and rural service points and a workforce of over 46,000 people. The difference, year after year, is covered by the public budget.

It is not the only subsidy. Under the new Postal Law it receives another €55.9 million for acting as a front desk for the Administration and as a bank in emptied-out rural Spain. And when the accounts still don't add up, SEPI (the state holding company) appears with its chequebook: €200 million in capital last year and guarantees to support a debt approaching €1 billion. None of this is irregular; as in much of Europe, the State pays for its postal service. But the figure lays the balance sheet bare.

From the first profit in 2019 to the worst year in its history

The decline of the letter explains part of the collapse; the other part lies in management. In 2018, after the no-confidence vote that brought Pedro Sánchez to La Moncloa (the prime minister's residence), Juan Manuel Serrano took over as chairman of Correos. He had been Sánchez's chief of staff when Sánchez was secretary general of the PSOE. With no prior experience in logistics and tasked with modernising the company, he opted for a radical pivot towards parcels.

In 2019 the company earned €13.4 million, its first profit after four years in the red. It was a mirage. The pandemic and failed commercial ventures peine a breach of more than €700 million in losses up to 2023, which management papered over with credit. Net assets were nearly halved and bank debt, which had started at just €15 million, soared past €950 million.

To seek revenue beyond the letterbox, Serrano embarked on two adventures. Correos Cargo was to charter cargo planes from Asia with Iberojet, the airline of Ávoris, which SEPI had rescued months earlier with €320 million. It was cancelled early and ended up in court, with cross-claims of up to €57 million. Correos Telecom wanted to sell mobile and fibre to consumers, but barely found customers and closed in 2024. When Serrano left at the end of 2023, the main unions bid him farewell speaking of terrible management and incompetence, and of a €1.2 billion hole. Judge Santiago Pedraz charged him last July in the Leire Díez case, after the UCO (the Civil Guard's investigative unit) attributed a preeminent role to him in the alleged scheme. Being charged does not equal a conviction and the proceedings remain open.

The change of leadership did not close the wound

In December 2023 Pedro Saura, a former Socialist MP, took over as chairman, inheriting a company with runaway debt and deep operational deterioration. After months of negotiation, he agreed with SEPI and the main unions on a Framework Agreement and a Strategic Plan 2024-2028. But his first full year was the worst in Correos' history. In 2024 the company lost €94 million from its operations, to which €427.9 million were added to fund a voluntary redundancy plan through 2028, aimed at workers over 61 and civil servants on extended leave. The net result closed with €458.5 million in the red.

The comparison with earlier periods is tricky, and it is worth saying so. Feijóo chaired Correos between May 2000 and January 2003, appointed by the Aznar government. The company had lost around €29 or 30 million in 1999 and closed 2002 with profits, around €30 million according to the note from Correos itself at the time. During his tenure the company became a state-owned commercial entity and lost about 666 workers. But in 2000 the letter was still the core business, and letters are cheap to deliver because each route carries high volume. Today that floor has collapsed.

The operational collapse customers see

Beyond the balance sheets, there is a deterioration measured in user experience. The complaints repeat themselves: failed delivery notices when the recipient was at home, strict measuring and weighing of envelopes and parcels forcing a resend over 50 extra grams, a lack of the company's own automated lockers in many locations and office hours reduced to the morning slot from Monday to Friday. Some point out that the Citypaq locker network exists; others reply that in their experience a parcel left in a locker went missing and only turned up at the office a week later.

The debate over opening hours has its nuance. In rural offices in villages of 50 or 100 inhabitants, with no volume of mail or parcels, keeping eight hours of service makes no sense. In urban offices in metropolitan areas with tens of thousands of inhabitants, closing at 2 pm is another matter. And in summer there are areas where delivery is suspended and mail piles up until September.

Why is it debated whether Correos should remain public?

Because the universal service obliges it to reach places no private company wants to go at an affordable price, and that does not pay for itself. One camp argues the company is broken and is only kept alive by public transfers; another recalls that the State pays for its postal service in much of Europe and that the problem is not ownership but management. In between, some claim, without offering any evidence, that the postal network is used to handle postal voting; that assertion should be treated as what it is: a political accusation, not a fact.

The figure that unsettles is none of the big ones. It is this: in 2025 Correos made money again, €11.2 million. And it did so thanks to the public purse.