A drop in online sales and rising costs helped push Amazon to its first loss since 2015.
The e-commerce giant’s online sales fell 3% in the first three months of the year as the pandemic’s boom in its business begins to fade, the company announced on Thursday.
Growth in other businesses, including cloud computing and advertising, remained strong.
But she is struggling with the fallout from rising costs and the Ukraine war.
Overall, Amazon reported a $3.8 billion loss, largely due to a slump in its investment in electric-car maker Rivian.
Sales growth of only 3% is forecast for the coming months.
“The pandemic and subsequent war in Ukraine have brought unusual growth and challenges,” said Amazon CEO Andy Jassy.
The company’s total revenue continued to grow 7% year over year to $116.4 billion, driven by Amazon Web Services (AWS) — the company’s cloud computing arm and a reliable earnings driver.
AWS revenue grew 37% year over year, while advertising revenue was also strong, up 23%.
But growth has slowed significantly elsewhere — particularly in its international business, where revenue fell 6%.
Expenses are also increasing rapidly. Inflation added $6 billion to spending in the quarter, executives said. The company also faces expanding union initiative in the US.
The company’s shares fell more than 7% in after-hours trading. And concerns spread to other online retailers, adding to fears in US markets, which have been bearish for the past few weeks.
Strong results from Apple helped allay some of those concerns.
The iPhone maker announced that revenue rose 9% year over year to $97.3 billion and profit rose more than 10% to $25 billion.
Add Comment