Covid pushes Amazon to record profit

A person carrying a Prime parcel by retailer Amazon
Photo: Jeramey Lende / Shutterstock.com

Amazon reached its highest profit ever thanks to the Covid-19 pandemic: it sold 40 % more than the year before, enabling profit to double to 5.2 billion dollars (4.4 billion euros).

 

Profit doubles as sales boom

Last semester, the Covid-19 pandemic pushed Amazon's profits to 5.2 billion dollars, almost twice as much as a year before. Almost all of that profit was, as promised, reserved for investments during the pandemic, ranging from staff bonuses to investments in logistics.

 

Even though most of the company's profit comes courtesy of the AWS cloud services, the rapid growth of online sales contributed hugely as well. Amazon's turnover was 88.9 billion dollars (75 billion euros), a 40 % rise and significantly more than CEO Jeff Bezos' own forecast of 75 to 81 billion dollars.

 

48 % higher

Amazon's second quarter showed a 47.8 % rise in turnover from e-commerce to 45.9 billion dollars (39 billion euros), beating analysts' expectations of 39.9 billion. While North-American turnover (online and offline) grew to 55.4 billion dollars, international sales grew from 16.37 to 22.67 billion dollars (19 billion euros).

 

The number of orders even went up 57 %, as online groceries tripled. Physical stores, however, suffered from the pandemic and many were forced to close - leading to a 13 % turnover drop.

 

Prime Day delay

Amazon expects its third-quarter turnover to be in the range of 87 to 93 billion dollars (73 to 78 billion euros). Covid-related costs in the next quarter should amount to two billion dollars, but operational profit should still rise to five billion dollars.

 

A big drawback for the company is the loss of its annual discount festival Prime Day, which is - at best - pushed back to the fourth quarter. Notable exception to the latter is India, where the local Prime Day will go ahead as planned later this month.