Amazon, whose operations have been put to an extreme test during the coronavirus outbreak, posted mixed first-quarter earnings.
Founder and CEO Jeff Bezos issued a remarkably assertive statement along with the the company’s earnings, saying the tech giant is “not thinking small” and plans to plow billions of profits back into its COVID-19 response.
Revenue rose 26% to $75.5 billion, ahead of expectations, but pandemic-related expenses dragged down earnings per share to $5.01, off 31% from the same period a year ago.
Shares in the tech giant sold off in after-hours trading but have bucked the market’s broader selloff in recent months, hitting new highs and closing Thursday at $2,474 after establishing yet another all-time top.
“From online shopping to AWS to Prime Video and Fire TV, the current crisis is demonstrating the adaptability and durability of Amazon’s business as never before, but it’s also the hardest time we’ve ever faced,” founder and CEO Jeff Bezos said in the earnings release. “Providing for customers and protecting employees as this crisis continues for more months is going to take skill, humility, invention, and money. If you’re a shareowner in Amazon, you may want to take a seat, because we’re not thinking small. Under normal circumstances, in this coming Q2, we’d expect to make some $4 billion or more in operating profit. But these aren’t normal circumstances. Instead, we expect to spend the entirety of that $4 billion, and perhaps a bit more, on COVID-related expenses getting products to customers and
keeping employees safe.”
The billions in spending, he went on “includes investments in personal protective equipment, enhanced cleaning of our facilities, less efficient process paths that better allow for effective social distancing, higher wages for hourly teams, and hundreds of millions to develop our own COVID-19 testing capabilities. There is a lot of uncertainty in the world right now, and the best investment we can make is in the safety and well-being of our hundreds of thousands of employees. I’m confident that our long-term oriented shareowners will understand and embrace our approach, and that in fact they would expect no less.”
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