Amazon stumbles in Q1 overall, ad revenue up 25%
Amazon has reported a difficult Q1 for 2022, as it saw a US$3.8 billion (A$5.35 billion) net loss in the quarter, resulting in a 10% dip in shares overnight.
The majority of Amazon’s losses came via its investment in Rivian, an electric vehicle company. The total losses from its investment in Rivian totalled US$7.6 billion (A$10.7b), as the company lost more than half its value this quarter.
A tough quarter for Amazon, but buoyed by its advertising services
Hamstrung by its investment in Rivian, Amazon’s growth rates were reported as the company’s worst since 2001.
Amazon CEO, Andy Jassy said: “The pandemic and subsequent war in Ukraine have brought unusual growth and challenges.”
The losses across Q1 compared with a net income of US$8.1 billion (A$11.4b) in Q1 2021.
Amazon’s advertising services did see an uplift of 25% in the quarter, however, totaling US$7.88 billion (A$11.1b).
Jassy continued: “Today, as we’re no longer chasing physical or staffing capacity, our teams are squarely focused on improving productivity and cost efficiencies throughout our fulfillment network. We know how to do this and have done it before. This may take some time, particularly as we work through ongoing inflationary and supply chain pressures, but we see encouraging progress on a number of customer experience dimensions, including delivery speed performance as we’re now approaching levels not seen since the months immediately preceding the pandemic in early 2020.”
Amazon’s share price is $2,891.93 as of April 2022. It has a market capitalisation of US$1.471 trillion (A$2.07t).
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Calum Jaspan was news editor at Mumbrella, based in Melbourne. He was also the producer and host of the Mumbrellacast. He left Mumbrella in May 2023.
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