The booming Internet trade and flourishing cloud services are giving Amazon strong business growth in the Corona crisis. However, Amazon also has high expenses. That shrinks the profit.
Revenue increased 26 percent year-over-year to $ 75.5 billion in the first quarter. However, Amazon also has high expenses due to the pandemic – for example, due to a recruitment campaign in the face of the large number of customers on its delivery services. Quarterly earnings fell about 30 percent to $ 2.5 billion.
However, the greatest burdens still lie ahead. For the current quarter, Amazon warned of special costs of around $ 4.0 billion due to the corona pandemic. The group plans to invest in its delivery logistics and measures to protect employees. Amazon forecasted operating profit in a range of $ 1.5 billion to $ 1.5 billion, predicting an 18 to 28 percent increase in revenue. Amazon emphasized that reliable forecasts are currently difficult.
More course information on Amazon
It is invested
Exit restrictions due to the corona pandemic have exploded demand for Amazon’s delivery services in many regions of the U.S. in recent months. However, the company struggled with the large crowds and was temporarily overwhelmed. Many customers still have to wait longer than usual or cannot place any orders with the coveted food delivery services.
Bezos wants to solve these problems with high investments. While US companies are cutting jobs at record speed, Amazon is hiring employees on a large scale. In March it was announced that 100,000 employees would be hired to cope with the increased demand. Another 75,000 were hired in April.
But Amazon is also heavily criticized for its working conditions – especially in the corona crisis. The company is accused of not doing enough to protect its employees and is repeatedly confronted with protests. Amazon rejects the allegations, but could still get into trouble. For example, the mayor Bill de Blasio and the powerful Attorney General Letitia James intervened because of the controversial dismissal of a strike organizer in New York.
In the era of staying at home and working from home, the company can still rely on its lucrative cloud business, which includes IT services and storage space on the Internet. Amazon’s flagship, the web platform AWS – the market leader in cloud services for companies – increased revenue in the most recent quarter by almost a third to $ 10.2 billion. The division’s operating profit even grew by around 40 percent to $ 3.1 billion. Amazon’s largest cloud rival Microsoft had also reported strong growth in this area the previous day.
Bezos is heading for the 200 billion
The stock initially reacted to the quarterly report with significant price losses. Nevertheless, Amazon has so far been one of the big winners in the crisis. In the past three months, the share price has risen by over 30 percent and reached new record highs. As a major shareholder, CEO and founder Jeff Bezos also benefits greatly.
According to the Bloomberg Billionaires Index, his wealth has increased by around $ 29 billion to $ 143 billion since the beginning of the year, so that he significantly expanded his status as the richest person in the world during the crisis.
ts / dpa
Source: boerse.ard.de
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