For the third quarter of this year, which ended on June 30, Amazon’s net income decreased to $2.9 billion from the third quarter of 2021’s $3.2 billion.
In the meantime, third-quarter net sales rose by 15% to $127.1 billion from third-quarter 2021’s $110.8 billion.
This quarter’s diluted earnings per share were 28 cents, down from the diluted earnings per share of 31 cents in the third quarter of last year.
“We’re encouraged by the steady progress we’re making on lowering costs in our stores fulfillment network and have a set of initiatives that we’re methodically working through that we believe will yield a stronger cost structure for the business moving forward,” said CEO of Amazon, Andy Jassy, released a statement.
Jassy continued by saying that Amazon would keep balancing its investments to make them more efficient without jeopardizing the business’s long-term, strategic bets.
The third quarter saw moderating sales growth across many of Amazon’s businesses as well as increased foreign exchange headwinds, according to CFO Brian Olsavsky during the earnings call with investors.
“We expect these impacts to persist throughout the fourth quarter,” On the call, Olsavsky said. “We are also making efforts to tighten our belts, as we have in previous difficult periods of our history. Examples include halting hiring in some businesses and discontinuing goods and services where we think our resources would be better used elsewhere.”
Amazon predicts that net sales will be between $140 billion and $148 billion in the fourth quarter, up between 2% and 8% from the same period in 2021.
“As I look ahead to guidance for the fourth quarter, I think the biggest individual factor is still going to be foreign exchange,” Olsavsky said. “Foreign exchange has a greater impact on our revenue growth in dollars than it does on our income.”
After falling 13% in extended trading last Thursday when the company released its fourth-quarter forecast, Amazon shares are still down 1.5% in today’s trading.
“As far as the new normal, we’re working very hard to make sure that current profitability is not the new normal,” Olsavsky said on the call, “and we’ll see how quickly we can make improvements.”
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Source: https://www.furnituretoday.com/financial-results/were-taking-actions-to-tighten-our-belt-says-amazon-cfo/
