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Home / Business / Amazon exceeded expectations in the third quarter, with revenue up 37%

Amazon exceeded expectations in the third quarter, with revenue up 37%



If there is one thing highlighted by Amazon̵

7;s third-quarter earnings report, it is that the coronavirus has not hit all retailers in the same way. By 2020, the e-commerce giant’s tears are already at risk, and even for those analysts who are expected to achieve significant results in the third quarter, the final number may surprise people.

The results exceeded expectations at every point, with revenue and earnings per share increasing by 37%, exceeding expectations, which was mainly driven by its e-commerce business.

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In the three months ended September 30, the company achieved revenue of $96.1 billion. Net income was US$6.3 billion, or US$12.37 per share, which was actually three times the US$2.1 billion (US$4.23) in the same period last year.

Analysts expect revenue of US$92.71 billion and earnings per share of US$7.41.

CEO Jeff Bezos explained in a statement: “We are seeing more customers shopping for holiday gifts than ever before. This is just a sign that this will be unprecedented. Holiday.”

The coronavirus pandemic has effectively curbed physical shopping, spread to online consumers, enhanced e-commerce, mobile and social commerce activities, and set off frantic developments aimed at consolidating these behaviors.

Perhaps most notably, the data for the third quarter did not even include golden day sales. Amazon postponed its annual shopping event from July to October, and then immediately launched the Holiday Dash promotion, allowing consumers including 150 million major subscribers to enter the early purchase of the peak season.

“Despite the lack of prime time, Amazon still produced explosive sales growth in the third quarter, which made the annual comparison blurred. However, we noticed that North American retail revenue increased by 8% compared to the second quarter of 2020, and profit The rate actually increased by about 10 [basis points]Charlie O-Shea, vice president and retail analyst at Moody’s, said: “This is impressive.

“More specifically, transportation costs [the second quarter], And more than 5 billion US dollars per year, [third-quarter] 2019 includes Golden Day, and [third-quarter] The proportion of shipments to total retail sales in 2020 will climb to nearly 18%,” he said.

This gives Amazon enough reason to believe that the fourth quarter-including Golden Week performance-will be unparalleled.

During the earnings call on Thursday, Chief Financial Officer Brian Olsavsky pointed out that third-party sellers performed well during the “golden trading day.” He said that these merchants are mainly composed of small and medium-sized enterprises and thrive on the “golden trading day”. Third-party sellers realize that the sales of global events today exceed 3.5 billion U.S. dollars.

Olsavsky went on to say that the company is “investing heavily” to support third-party sellers. According to reports, more than half a million sellers saw record sales in Amazon stores this year.

The entire e-commerce field is expected to grow substantially in the fourth quarter. Adobe predicts that e-commerce will reach 189 billion US dollars during the holiday season, an increase of 33% year-on-year, while Shopify reports that 97% of US Black Friday/Cyber ​​Monday shoppers plan to shop online during the weekend.

If Amazon’s fourth-quarter revenue guidance can be trusted, the company will account for a large part of this activity: For the next quarter, Amazon’s guidance ranges from US$112 billion to US$121 billion, reducing analysts’ 112.7 billion The dollar is expected to be the lowest or lowest.

According to Episerver, a digital experience and business solutions company, Amazon will occupy an increasing share of the holiday market, with 11% of consumers planning to purchase all holiday gifts through its market this year. Customer experience platform Iterable reports that 35% of consumers said they plan to shop more on Amazon this season than in previous years.

This may bode well for its bottom line, but Amazon warned that due to COVID-19-related expenses, operating profit in the fourth quarter may be hit, estimated at $4 billion. This is expected to reduce the company’s operating profit to between US$1 billion and US$4.5 billion, not reaching the US$5.81 billion forecast.

Elsewhere in the Amazon empire, its cloud business managed to reach the approximate level expected by analysts, with sales of Amazon Web Services reaching $11.6 billion. Its “other” segment (including Amazon’s advertising business) sales reached $5.4 billion, an increase of 51% year-on-year.

At least part of the report brought the challenge of the pandemic closer to the tech giants: Like most brick-and-mortar stores, its physical store sales fell by 10% to $3.78 billion.

In other comments, Bezos emphasized that Amazon raised its minimum wage to $15 in the United States two years ago and pointed out that 400,000 jobs were created this year. The total number of Amazon employees has now exceeded the threshold of 1 million to 1.13 million, an increase of 50% over last year.

“We continue to focus on improving the safety of our employees, especially in our fulfillment and logistics operations, to ensure the safety and well-being of our employees and partners, as well as employees and customers shopping in our Whole Foods Market and other markets. “, Olsavsky said.

According to Amazon, engagement is on the rise, and people are buying “more and more frequently and in more categories,” the treasurer added, and it is leveraging its digital revenue, including Prime Video and other online services. “We think this will have lasting value.”

Amazon’s performance is part of Thursday’s massive aftermarket revenue report, which shows that despite the pandemic (even if key players are increasingly affected by antitrust microscopes), large-scale technology is still an economic force that cannot be ignored .

Alphabet, Google’s parent company, pushed quarterly revenue growth by 14% to $46.2 billion.

• Facebook’s revenue increased by 22% to 21.2 billion US dollars.

• Apple’s revenue rose slightly by 1% to $64.7 billion. The company sounds confident in its new products.


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