The U.S. Postal Service reported a $2.5 billion net loss for the fiscal third quarter, though the loss was nearly $600 million smaller than the same period last year.

Postmaster General David Steiner is urging Congress to take action, warning that without reforms, USPS may need to reduce services, close thousands of unprofitable post offices and raise prices.

Steiner said a proposed expansion adding dozens of new ZIP codes could cost the financially struggling agency about $800 million.

USPS loses billions maintaining six-day delivery to 170 million addresses, while declining first-class mail revenue has contributed to more than $120 billion in losses since 2007, NBC News has reported.

The agency has already suspended some spending and pension contributions and raised the price of first-class stamps to 82 cents as it seeks ways to preserve cash.