• Zimbabwe’s postal and courier sector recorded a 117.5% cost-to-income ratio in Q4 2025, meaning operators spent about ZWG1.18 for every ZWG1 earned
• Total postal and courier volumes fell 19.09% quarter-on-quarter, while domestic postal letters dropped 47.23%, confirming that digital substitution is accelerating demand erosion
• DHL reduced its Zimbabwe footprint from 46 outlets to 40, becoming the only courier operator to close outlets in Q4 as the sector’s operating pressure deepened

Harare- Zimbabwe's licensed postal and courier operators has recorded a cost-to-income ratio of 117.5% in the fourth quarter of 2025, worsening by 10 percentage points from 107.5% in the third quarter of 2025, according to POTRAZ's Q4 2025 Sector Report.

Revenue contracted 2.3% from ZWG 189.89 million to ZWG 185.51 million, while operating costs increased 6.8% and capital expenditure rose 149.3%. A sector spending ZWG 1.175 for every ZWG 1.00 it earns, across two consecutive quarters above the 100% cost-to-income threshold, is not experiencing a cyclical downturn. It is in structural decline.

The volume data confirms the structural character of the contraction. Total postal and courier volumes fell 19.09% from 359,794 items in Q3 2025 to 291,106 items in Q4 2025. Domestic postal letters declined 47.23%, from 197,611 to 104,277 items. International outgoing letters fell 53.64%. Domestic courier volumes were essentially flat at 118,824 items. The only categories recording volume growth were international incoming letters, which surged 372.70%, and international incoming courier at 18.35%, both passive categories that reflect inbound activity from external senders rather than organic Zimbabwean postal demand.

DHL, Zimbabwe's largest international courier operator with 46 outlets at the start of Q4 2025, closed 6 outlets during the quarter, ending with 40. It is the only courier operator in the sector that reduced its footprint in Q4 2025. DHL's decision to contract its Zimbabwe network is commercially rational, a business operating in a market where physical letter volumes are falling 47% per quarter, where the sector's cost-to-income ratio has exceeded 100% for multiple consecutive periods, and where digital substitution is accelerating, does not expand its fixed-cost infrastructure.

It consolidates to its highest-performing locations and manages the decline. That DHL has moved from consolidation to closure in Q4 2025, rather than waiting for conditions to stabilise, is a signal about the pace of the sector's deterioration that the aggregate data alone does not fully convey.

The postal and courier sector's contraction is not primarily a consequence of Zimbabwe's economic environment, though the economic environment amplifies it. It is a consequence of digital substitution that is operating at a pace no postal operator globally has successfully reversed. Physical letters exist to communicate information between sender and recipient. Once email, WhatsApp, and mobile money transfer become the default mechanisms for that communication, the letter category does not recover.

The 47.23% decline in domestic postal letters in a single quarter, against a backdrop of 107.04% mobile penetration and 84.55% internet penetration, reflects a population that has already made the substitution and is not reverting.

The courier market is more defensible because it delivers physical goods rather than information, and physical goods cannot be digitised. E-commerce is the natural demand source for courier services in markets where the letter category is collapsing, packages from Alibaba, Amazon, and regional platforms require physical delivery. International incoming courier growing 18.35% in Q4 2025 is consistent with an e-commerce demand story.

The problem for Zimbabwe's postal and courier operators is that international e-commerce delivery into Zimbabwe increasingly bypasses licensed postal operators in favour of informal channels, private freight forwarders, and the diaspora gift-economy logistics networks that have operated outside the formal postal system for decades. The formal sector is capturing a declining share of a growing informal courier market.

The 149.3% increase in capital expenditure by postal and courier operators, from ZWG 764,631 to ZWG 1,906,603, in the same quarter that revenue contracted 2.3% and volumes fell 19% appears paradoxical. The investment is most likely in digital infrastructure and tracking systems rather than physical outlet expansion, as the DHL closures confirm that physical footprint is contracting. Whether that technology investment produces the operating efficiency improvements that could eventually move the cost-to-income ratio below 100% is the sector's central strategic question.

The Q4 2025 data, revenue down, costs up, volumes down nearly 20%, market leader closing outlets, does not provide evidence that the answer is imminent.

POTRAZ's 2026 outlook for the sector is defined by a rapid transition toward a data-centric ecosystem, and that the Zimbabwe National Artificial Intelligence Strategy for 2026-2030 will catalyse adoption of AI and data-hungry services. These are accurate sector-level observations. They are also sector-level observations that describe the telecommunications and internet sub-sectors, not the postal and courier sub-sector. AI adoption and data consumption growth do not generate postal letter volumes.

If anything, they accelerate the substitution that is already collapsing the letter category. The postal and courier sector's structural challenge does not have a digital solution, it has a managed decline trajectory that requires the regulator and the licensed operators to make clear-eyed decisions about which services remain commercially viable, which require cross-subsidy, and which should be rationalised before the cost-to-income ratio reaches levels that threaten operator solvency rather than merely profitability.