Amazon.com Inc. CEO Jeff Bezos promised to spend all the additional profits the company made from a huge boost in sales related to the COVID-19 pandemic, but sales grew so fast that it ended with record earnings instead.
reported second-quarter profit of $ 5.2 billion, or $ 10.30 a share, on Thursday afternoon, nearly doubled from $ 5.22 a share a year ago to a new quarterly record amid a huge boost in revenue. Amazon reported sales of $ 88.9 billion, up 40% from $ 63.4 billion a year earlier and well ahead of Amazon’s forecast of $ 75 billion to $ 81
Three months ago, Bezos said he is expected to spend billions on the new operating profit that is sinking as Americans take refuge in-place because of the coronavirus buy more items online and businesses spend more on cloud computing to support workers stuck in the house. “If you’re an Amazon owner, you might want to take a seat, because we’re not thinking small,” Bezos said in May.
Shareholders did not escape, however. Amazon’s stock instead continued to record record highs, gaining more than 24% in the last quarter and forcing the company’s market capitalization to above $ 1.5 trillion. Shares rose more than 4% in trading after Thursday hours immediately after the results were released.
“This was another very unusual quarter, and I couldn’t be more proud and grateful for our employees around the world,” Bezos said in Thursday’s news. “As expected, it spent more than $ 4 billion on COVID-19-related incremental costs in the quarter to help employees keep safe and deliver products to customers in this time of high demand – buy personal protective equipment, increase the cleaning of our facilities, follow the new safety process paths, adding new benefits to backup family care, and pay a special bonus of more than $ 500 million to line employees and delivery partners. ”
Amazon’s core business achievements show why investors are sticking with Amazon, and more are joining them. The company said its e-commerce business grew 47.8% from last year in the second quarter to revenue of $ 45.9 billion from $ 31.05 billion, while analysts were expecting $ 39.89 billion. In North America, net sales online and in physical Amazon stores like its Whole Foods Markets chains grew to $ 55.44 billion from $ 38.65 billion a year ago, while sales outside the foreigners grew to $ 22.67 billion from $ 16.37 billion.
Amazon Web Services, the cloud computing company, saw revenue jump to $ 10.8 billion from $ 8.38 billion, while analysts on average were expecting $ 11 billion. As usual, AWS was the biggest profit driver for Amazon, delivering an operating profit of $ 3.36 billion while Amazon reported overall operating revenue of $ 5.84 billion.
Even before the pandemic, Amazon was spending to streamline its logistics operations to handle faster shipping for its Prime subscription service customers, and COVID-19 forced that range of spending into hyperdrive. . Amazon passed 1 million employees, Bezos revealed in testimony scheduled for an antitrust hearing Wednesday before a congressional subcommittee, though because many are still listed as temporary, Amazon reported the number as 876,800 Thursday.
Amazon said it expects revenue to be between $ 87 billion and $ 93 billion in the current quarter, and has learned from its previous guide to expecting a profit, predicting operating revenues of $ 2 billion to $ 5 billion even by amounting to $ 2 billion in COVID-19 related costs.