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Amazon’s quarterly revenue is expected to top $100bn for the first time ever when it announces its latest earnings on Tuesday, as the bumper Christmas sales period combined with elevated demand from the pandemic.
The ecommerce giant’s traditionally conservative guidance suggested revenue between $112bn and $121bn in the October-December period. Unlike 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 is expecting quarterly revenue of $119.7bn, according to FactSet — which would be a 37 per cent increase on the fourth quarter of 2019 and bring Amazon’s total revenue for the year to more than $380bn.
The company said it expected between $1bn-$4.5bn in quarterly operating income, the wide range attributed to continued uncertainty over the costs of managing the pandemic. Wall Street expected Amazon to hit the high-end of that estimate, but analysts remain wary of mounting costs, whether from specific Covid-19 measures — expected to be $4bn in the fourth quarter alone — or the Herculean effort to hire more than 400,000 workers since the onset of the pandemic.
Analysts at Jefferies said the rapid growth of Amazon’s own delivery network will have given it an additional edge over competitors, however. Other retailers have been held back by limited shipping capacity and delays.
Logistics consultant Marc Wulfraat estimated that Amazon delivered 5bn of its own packages to customers in the US — 67 per cent of all its orders — versus 2.5bn in 2019. On Tuesday, US regulators announced a $61.7m settlement with Amazon to repay drivers for tips allegedly wrongfully withheld.
As well as reducing shipping costs for Amazon, the company’s own network helps it shorten delivery times — the key driver of membership to its Prime programme. The number of Prime members is expected to have grown by about 20 per cent globally, to 180m.
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