Saturday 30 October 2021

Disappointing Quarter Amazon; Facing Soaring Costs

 Amazon reported a big fall in profits yesterday and highlighted that it was facing billions of dollars in extra costs to manage supply chain and labour shortage challenges over the key festive period.

After benefitting from the surge in online shopping during the pandemic, Amazon’s third-quarter results disappointed Wall Street. Net income fell by 50% to $3.16bn on total revenues up only 15% to $110.8bn – the company’s slowest rate of growth since 2015.

NamNews Implications:

  • Fortunately for Amazon, they have not even started to use accumulated muscle…
  • Meanwhile, to maintain its consumer-centric reputation they will have to absorb costs:
    • labour rates
    • supply chain bumps
  • But there are limits, even for Amazon.
  • i.e. suppliers will feel the pain before consumers…
#AmazonSlows #ProfitSqueeze

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