Amazon Stumbles On Slower Sales, Higher Labor Costs
Amazon isn’t just grappling with the easing of pandemic-induced shopping splurges. The online retail behemoth is also contending with surging costs as it navigates a snarled supply chain and labor shortages, Anne D’Innocenzio reported for the Associated Press (AP).
Photo Insert: The Amazon Sphere
Those challenges resulted in Amazon reporting a shortfall Thursday in third-quarter profits and sales. It also led the Seattle-based company to deliver a holiday sales forecast that was below Wall Street expectations.
The issues are the latest twist that Amazon has had to confront since the beginning of the pandemic in the spring of 2020.
Amazon was one of the few retailers that have prospered during the COVID-19 outbreak: As physical stores selling non-essential goods temporarily or permanently closed, homebound people turned to Amazon for everything from groceries to cleaning supplies.
The company reported a profit of $6.2 billion, or $6.12 per share, for the three-month period ended Sept. 30. That compared with a profit of $6.3 billion, or $12.37 per share during the year-ago period. Revenue rose 15% to $110.8 billion, the company’s fourth consecutive quarter of revenue topping $100 billion.
Analysts surveyed by FactSet, however, on average expected $111.55 billion in quarterly revenue and per-share earnings of $8.90. Amazon said that its sales for the fourth quarter should be between $130 billion and $140 billion, a growth of between 4% and 12% compared with fourth quarter of 2020.
Analysts polled by FactSet had been expecting $142.17 billion.