The world’s largest online retailer, Amazon, earned around 50 percent less in the third quarter than in the same period last year. Revenue growth was also significantly lower, and the outlook for the full year is below analysts’ expectations. The subsiding of the online boom after the outbreak of the corona pandemic, ongoing global delivery difficulties and a lack of workers in the USA are cited as the main reasons for the weakness of the group. The share price dropped by more than four percent at times.
Another US tech company, Apple, announced bad news almost at the same time. Apple boss Tim Cook warned of a prolonged prolongation of the chip crisis, which would affect all of the company’s products. The negative outlook initially also weighed on the German leading index Dax on Friday.
The start of the new Amazon boss Andy Jassy thus coincides with a time of upheaval. “It was Andy Jassy’s first announcement without the news of Jeff Bezos’ departure influencing the discussion,” says trade expert Andy Halliwell of the Publicis Sapient consultancy. You could see how the tone changes and Jassy settles into his new role. “That shouldn’t matter to anyone as long as the company is missing out on most of its key metrics and the return to shareholders is very different than expected.” The profits have fallen below the worst-case scenario of most analysts. They would have been well below the expected eight or nine dollars a share.
Jassy announced that the goal was to deliver all Christmas gifts on time. In the third quarter alone, 133,000 employees were hired as a result. Amazon now employs almost 1.5 million people. The group is doing everything possible to mitigate the consequences of the bottlenecks for customers. That is expensive, but it pays off in the long term.
In the current fourth quarter, Amazon expects revenues between 130 and 140 billion dollars. The group thus fell short of expectations for the most important quarter for retailers because of Christmas and Thanksgiving. Sales grew by 15 percent to just under $ 111 billion from July to September, thanks mainly to the flourishing business of the cloud division AWS. However, that was the smallest increase since the beginning of the Corona crisis. In return, the almost halved profit was still around 3.2 billion dollars. “Amazon is and will remain the measure of all things for retail,” says online retail expert Nils Seebach. “Even a supposedly weak quarter in the e-commerce segment will not change that.”