Amazon easily beat second-quarter earnings and revenue forecasts after the market closed on Thursday, and CEO Jeff Bezos called it “another very unusual quarter” amid the ongoing coronavirus pandemic.
“As expected, we spent over $ 4 billion on incremental COVID-19 related costs in the quarter to help keep employees safe and deliver products to customers at this time of high demand: purchase of personal protective equipment , increased cleanliness of our facilities, after new security processes, adding new backup family care benefits and paying a special $ 500 million appreciation bonus to frontline employees and delivery partners, “he said Bezos in a statement.
The titan of e-commerce and web services has created more than 175,000 new jobs since March, he added, and is in the process of creating 125,000 of those full-time employees. Bezos also said the company “injected significant money into the economy” in the second quarter, investing more than $ 9 billion in capital projects that include fulfillment, transportation and Amazon Web Services (AWS).
For the second quarter of fiscal year 2020, the company reported earnings of $ 10.30 per diluted share of revenue of $ 88.9 billion, against analyst expectations of $ 1.46 EPS at $ 81.53 billion in revenue, according to Refinitiv.
Amazon shares shot up to 5% after the market closed, after rising 0.6% during the regular trading session. The major indices closed mixed, with the tech Nasdaq in the green ahead of earnings reports from Amazon’s Alphabet, Apple, Facebook and Google’s parent.
Some analysts continued to anticipate that Amazon would benefit from the current coronavirus pandemic, which has confined millions in the US and abroad to stay home to prevent the spread of COVID-19, prompting more trade orders. electronic and home entertainment consumption.
Grocery delivery capacity increased more than 160%, and online grocery sales tripled in the second quarter, year-over-year. A “significant” part of the Zoom network depends on Amazon Web Services, the company said, a remarkable fact given the heavy reliance on videoconferencing in the workplace in the past four months.
During the quarter that ended in June, Prime Video launched its Watch Parties feature, which allows Prime members to chat while watching Amazon video content, including TV and movies. It also introduced Prime Video Profiles so viewers can manage up to six profiles per account, allowing each profile to offer personalized recommendations. The Greg Daniels series “Upload” and original films such as “Selah and the Spades”, “The Goldfinch”, “The Vast of Night”, “7500”, “My Spy” and the Indian titles “Ponmagal Vandhal” and “Gulabo Sitabo ”debuted during the quarter.
In the previous quarter, when home shelter requests were first implemented, Prime Video viewers for the first time nearly doubled and video rentals increased, and consumers relied more on AI artificial intelligence from Amazon to listen to music and ask questions.
For the current quarter, Amazon forecasts net sales of $ 87 billion to $ 93 billion, which would mark a growth of 24% -33% compared to the third quarter of the previous year, well above analysts’ current estimates. of $ 86.29 billion. Operating revenue is expected to range from $ 2 billion to $ 5 billion, including more than $ 2 billion in COVID-19 related costs, according to the company.
The second-quarter earnings report follows Wednesday’s House antitrust hearing, which brought CEOs of Amazon, Facebook, Apple and Google to the House of Representatives’ Antitrust Subcommittee over anti-competitive concerns. When asked about a Wall Street Journal report on Amazon’s access to third-party vendor data to develop Amazon-branded products, Bezos said the e-commerce giant prohibits employees from using “vendor-specific data to help our private label business. ” but I cannot guarantee that this policy has never been violated. “
