Trebled profits Amazon’s reward for pandemic behaviour shift
Amazon has reported a tripling of profits in the first quarter of 2021, spurred by changing habits in the age of COVID-19.
Pandemic shopping habits
There’s little doubt that the pandemic has ultimately helped the tech giant’s business, which has its fingers in many of the sectors that have seen a boost - for instance video streaming and grocery delivery.
Accordingly, quarterly revenue rose from $75bn last year to $108.5bn, with other highlights including profits of $8.1bn - up from $2.5bn in 2020’s Q1.
“Strong customer demand globally”
Brian Olsavsky, Chief Financial Officer, said: “We continue to see strong customer demand globally in the first quarter. Revenue growth in our international segment grew 50% on an FX-neutral basis year over year in Q1 as restrictive regional and national lockdowns were in place throughout the quarter, particularly in the UK and Europe. In North America, revenue growth of 39% largely reflects the continuation of demand trends that we have seen since the early months of the pandemic. Third-party sellers were largely comprised of small- and medium-sized businesses, continue to see strong sales and serve more customers.”
Another important piece of the Amazon puzzle is its AWS cloud company, about which CEO Jeff Bezos said: “In just 15 years, AWS has become a $54 billion annual sales run rate business competing against the world’s largest technology companies, and its growth is accelerating—up 32% year over year. Companies from Airbnb to McDonald’s to Volkswagen come to AWS because we offer what is by far the broadest set of tools and services available, and we continue to invent relentlessly on their behalf.”
The news follows similarly excellent results from fellow tech giants like Apple and Google-parent Alphabet, all of whom have reported large revenue increases thanks in part to the pandemic.
Change is afoot at the company, with founder Jeff Bezos stepping down as CEO this summer to assume the role of Executive Chairman.