SEATTLE – Amazon’s third quarter net profit, ended September 30, declined to $ 3.2 billion from $ 6.3 billion in the third quarter of 2020, while net sales rose 15% to $ 110.8 billion in the third quarter, up from $ 96.1 billion in the same period last year.
Earnings per share were $ 6.23 per diluted share this quarter, compared to $ 12.63 per diluted share in the third quarter of last year.
“We have always said that when we are faced with the choice between maximizing short term profits versus what is best for long term customers, we will choose the latter, and you can see that in every phase of this pandemic. “said Andy Jassy, CEO of Amazon.
“One example is that we have almost doubled the size of our distribution network since the start of the pandemic. In the fourth quarter, we expect to incur billions of dollars in additional costs in our consumer business as we deal with labor shortages, rising labor costs, global supply chain issues and a increased transport and shipping costs, ”he added.
Amazon kicked off the holidays earlier this year, announcing Black Friday-worthy deals on October 4, including thousands of deals from independent sellers and artisan craftspeople, and Amazon’s largest selection of gift guides. Amazon has also launched new features like the Holiday Gift List to allow customers to create and share a list of gift ideas for everyone in their household. The company also unveiled its new Holiday Prep Shop, which features the best products in various categories to help customers prepare for the seasonal celebrations.
In its forecast for the coming fourth quarter, Amazon estimates net sales will be between $ 130 billion and $ 140 billion, a growth rate of 4% to 12% from the fourth quarter of last year. Forecasts assume an unfavorable impact of exchange rates.
“We’re going to be working on our cost structure for a while,” said Brian Olsavsky, Amazon CFO, on the quarterly earnings conference call. “The costs of COVID-19 are $ 1.5 billion lower this year compared to last year. But we’ll have a $ 4 billion gap: $ 2 billion for labor and inflation and $ 2 billion in operational disruption due to increased transportation costs.
Olsavsky also said that as the company moved into a more typical buffer zone, he predicted that it would be able to operate with more slack in the system and that it would be able to revert to a more normal rhythm.