Amazon reported huge growth in first-quarter revenue but a miss on earnings on Thursday.
According to a new report from CNBC, the e-commerce giant reported earnings for its first fiscal quarter of 2020, including revenue of $75.5 billion USD, net income of $2.5 billion, and earnings per share of $5.01 (compared to revenue of $59.7 billion, net income of $3.6 billion, and earnings per share of $7.09 in Q1 2019).
North American sales were up 29 percent to $46.1 billion USD, while international sales grew 18 percent to $19.1 billion. Amazon’s leadership position in online retail and the cloud makes it a bellwether during the coronavirus pandemic. In short, revenue was up but profit was down.
The largest US online retailer said it may incur a loss in the current quarter as it boosts spending to keep logistics operations running smoothly during the coronavirus pandemic.
“Under normal circumstances, in this coming Q2, we’d expect to make some US$4 billion or more in operating profit,” Bezos said on Thursday in a statement reporting Amazon’s results. “But these aren’t normal circumstances. Instead, we expect to spend the entirety of that US$4 billion, and perhaps a bit more, on Covid-related expenses getting products to customers and keeping employees safe.”
Further related to COVID-19, Amazon says it has procured 100 million face masks and is “requiring that they be worn by all associates, drivers, and support staff.” The company also purchased more than 1,000 thermal cameras and 31,000 thermometers. Those will be used “to conduct mandatory daily temperature checks for employees and support staff throughout our operations sites and Whole Foods Market stores.”
Although the full scope of the coronavirus’ impact on Amazon’s retail business won’t show until the company reports second-quarter earnings in summer, Wall Street was nervously watching for key signals from the first three months of 2020 pointing to Amazon’s financial soundness during the pandemic.