Amazon’s quarterly revenue is expected to exceed $ 100 billion for the first time when its latest results were announced on Tuesday, as the bumper Christmas sales period combined with high demand from the pandemic.
The e-commerce giant’s traditionally conservative forecast suggested revenues of between $ 112 billion and $ 121 billion over the October-December period. Unlike in previous years, the quarter included the company’s “Prime Day” sales event, which was pushed back into the holiday period from the summer.
Wall Street expects quarterly revenue of $ 119.7 billion, according to FactSet – which would be a 37% increase from the fourth quarter of 2019 and bring Amazon’s total revenue to the year to over $ 380 billion.
The company said it forecast quarterly operating profit of between $ 1 billion and $ 4.5 billion, the wide range attributed to continued uncertainty over the costs of managing the pandemic. Wall Street expected Amazon to hit the high end of this estimate, but analysts remain wary of rising costs, whether it is specific Covid-19 measures – which are expected to rise to $ 4 billion in the fourth quarter alone – or the Herculean effort to hire more than 400,000 workers since the start of the pandemic.
Jefferies analysts said the rapid growth of Amazon’s own delivery network, however, would have given it an additional edge over its competitors. Other retailers were held back by limited shipping capacity and delays.
Logistics consultant Marc Wulfraat estimated that Amazon delivered 5 billion of its own packages to customers in the United States – 67% of all orders – up from 2.5 billion in 2019. On Tuesday, US regulators announced a $ 61.7 million settlement with Amazon for reimburse drivers for tips allegedly wrongly withheld.
In addition to reducing shipping costs for Amazon, the own company network helping it shorten delivery times – the main driver behind its Prime membership. The number of Prime members is expected to increase by around 20% globally, to 180 million.