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Amazon Posts 2Q Loss But Revenue Tops Estimates, Stock Jumps

Scris: Vin 12 Aug, 2022 3:21 pm
de Hazel
The Seattle- groundede-commerce mammoth also said it's making progress in controlling some of the redundant costs from its massive expansion during the COVID- 19 epidemic.

Amazon lost$2.03 billion, or 20 cents per share, in the three- month period ended June 30, driven by a$3.9 billion write- down of the value of its stock investment in electric vehicle start- up Rivian Automotive.

That compared to a profit of$7.78 billion a time ago. It posted a loss of $3.84 billion in this time's first quarter, its first daily loss since 2015, which was also marked by a large Rivian write- down. Judges had been awaiting a 12- cent profit in the rearmost quarter, according to FactSet.

But Wall Street was cheered by Amazon's $121.2 billion in profit, beating prospects of$ 119 billion. The results came as the company attempts to navigate shifting consumer demand and advanced costs, while abridging the glut of storages it acquired during the COVID- 19 epidemic.
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Shares in Amazon. Rose nearly 14 in after- hours trading.
CEO Andy Jassy said in a statement that Amazon is seeing its profit accelerate as it invests in its high class and offers further benefits to members, similar as its recent deal to give free access to mess delivery service Grubhub for a time.

Subscription services have grown 10 compared to the previous time. Some judges estimate the company generated roughly$4.6 billion in profit during its Prime Day shopping event, which it held during the alternate quarter last time but moved to the third in 2022.

Amazon noted deals have also been dampened by foreign exchange rate oscillations.
“ Against this environment, Amazon’s performance is reasonable enough — but it's still a veritably long way from the astral figures Amazon generally produces, ” said Neil Saunders, managing director of GlobalData.

Jassy noted the company continues to feel inflationary pressure from advanced energy and transportation costs, but it's been making progress controlling charges related to its fulfillment network.

Between 2019 and 2021, Amazon nearly doubled the number of storages and data centers it leased and possessed to keep up with rising consumer demand. But as consumers shifted their habits, Amazon set up itself with too numerous workers and too important space, which added billions in redundant costs. The company has been ubletting some of its storages, ending some of its plats and postponing construction on others to deal with the problem.

Amazon’s Chief Financial Officer Brian Olsavsky said during a media call Thursday the company is decelerating down its expansion plans for this time and the coming to more align with client demand. He said the company is also planning to shift capital investments towards its pall- calculating unit AWS.

Amazon’s retail operations both internationally and in North America reported operating losses, showing the company is suffering the same fate as Walmart and Target, Saunders said. Costs are outpacing deals and growth, though Amazon can dip into other profit pools like AWS — to cover its overall performance, he said.

AWS, which is facing adding competition from Microsoft Azure, earned$19.74 billion in profit, a 33 jump from last time. While Amazon's advertising unit, another burgeoning moneymaker, pulled in$8.76 billion, an 18 increase from last time.
On the labor side, Amazon has been suitable to reduced its headcount through waste and staffing situations were more in- line with demand, Olsavsky said. The company had1.52 million workers by the end of June, down6.1 from the first quarter. The performance of the broader frugality is anticipated to shape its hiring plans moving forward.

“ I do n’t suppose you ’ll see us hiring at the same pace we did over the last time, or in last many times, ” Olsavsky said, adding the company will continue to hire targeted positions for profitable units, like its advertising business and AWS.

Despite Wall Street's festivity, thee-commerce and tech mammoth's profit growth still landed at a fairly sluggish 7, about the same as the first quarter of this time and its slowest in about two decades. It comes as the epidemic- convinced consumer reliance on online shopping dies down and Americans are shifting their spending habits down from effects like home advancements towards traveling and eating out.

Consumers and businesses are also feeling the weight of surging affectation, which is at its loftiest in 40 times. Faced with rising costs of food and gas, Americans have telephoned back purchases on optional particulars, forcing Walmart, Target and other retailers with redundant force to offer further abatements on particulars like electronics. Though Olsavsky said affectation hasn't cooled down demand.