Amazon reaches disappointing oversees sales and operational results

Amazon reaches disappointing oversees sales and operational results

American online giant Amazon had unexpectedly disappointing results for its expansion outside of the US in the second quarter of 2013. Sales were only 13 percent higher than in the same period of last year.

US area of biggest growth

Globally Amazon had sales of 15.7 billion dollar (12 billion euro) between early April and end June, 22% more than in the same period of 2012. That was a disappointing number, because the economic crisis in Europe keeps on troubling the company.

 

Sales outside of the US ‘only’ went up by 13% to 6.2 billion dollar (4.7 billion euro). The American home market grew by an impressive 30 percent.

 

Investing in sales leads to negative results

As operational costs soared by 23%, net profits of 7 million dollar turned into a net loss of the same amount. The last time Amazon made a loss, was in the third quarter of 2012.

 

Amazon is spending a lot of money to ensure future growth. For example, it invests heavily in more storage space closer to the consumers. That way the company wants to ensure faster deliveries.

 

Cloud computing and video content

Amazon is also trying to expand its range by not only focusing on the online sale of physical goods. They are also offering cloud computing to companies and governments for example. In that same vision they made the switch from books and cd to eBooks and mp3-files. The best sold items on Amazon currently are digital products.

 

That is also why the company is buying the rights to video content, so it can for example stream films or develop products for Kindle.

 

Next quarter also difficult

For the third quarter, Amazon is expecting sales between 15.45 billion dollar to 17.15 billion dollar (between 11.6 and 13 billion euro). The operational result is expected to be between a loss of 100 million dollar and a profit of 275 million dollar (-75 and +200 million euro).

 

That prognosis is so broad, because Amazon is taking several one-off expenses into account, but even the highest figures are lower than what was expected by financial analysts.

Questions or comments? Please feel free to contact the editors


Rocket Internet wants to go public with Home24

19/01/2018

Rocket Internet wants to go public with its furniture web shop Home24 in the summer. During the next few months, it will work tirelessly to improve the web shop’s results.

Carrefour buys stake in Showroomprivé

12/01/2018

Carrefour has obtained a 17 % minority stake in flash sale seller Showroomprivé with the intent of increasing its digital and non-food reach. Former shareholder Conforama did suffer a loss.

Will free home delivery disappear?

15/12/2017

A growing number of online orders also brings additional pressure on the logistical industry. Free home delivery can no longer be maintained according to research company ECC Köln. More flexible options should be installed.

Amazon brings its private labels to Europe

14/12/2017

After it introduced Amazon Prime to an increased number of European markets, Amazon is now bringing in its own FMCG private labels. Over the past few weeks, the online department store launched several private label products in Europe and it has plans for even more. 

Amazon Echo is now available in the Benelux

11/12/2017

Amazon announced it will ship its smart speaker Amazon Echo to another 28 countries, including Belgium and the Netherlands. Its own music streaming service will also get a local launch.

Luxury manufacturers can block retailers from selling on Amazon

07/12/2017

Luxury product manufactures can block retailers from selling their merchandise on online marketplaces like Amazon. The European Court of Justice has ruled on the matter after cosmetics manufacturer Coty filed a complaint.

Back to top