Amazon is managing inflation with an advantage as other shops struggle with the issue. Amazon’s most spectacular quarter to date, Q2 2023, exceeded expectations. “It was another strong quarter of progress for Amazon,” CEO Andy Jassy said in a statement on Thursday, August 3.
The earnings demonstrate how successful Jassy’s efforts to cut expenses have been. With the elimination of 27,000 roles since the previous autumn and a “small number” of staff in its Pharmacy division in July, Amazon undertook its largest employment reduction.
Corporate hiring was also suspended, and Jassy aggressively worked to reduce spending across all areas. Amazon has 1.46 million employees worldwide as of the end of the second quarter, according to Statista.
Amazon’s Prime Day in July was the finest ever. According to data from Adobe Analytics, Prime Day sales in the US hit $12.7 billion, a record for this sales event and a 6.1% rise over the previous year. Amazon said more than 375 million things were bought throughout the event. The first day of the sale was the most successful sales day the firm had ever had.
This year’s Prime Day was when Amazon emphasized the importance of small companies since their participation outperformed that of Amazon’s retail division.
Before the event, PYMNTS interviewed Claire O’Donnell, director of selling partner empowerment, communities, and trust at Amazon. The topic of discussion was Amazon’s renewed emphasis on supporting offers from small and medium-sized enterprises (SMBs).
O’Donnell drew attention to a change in consumer behavior in which purchasing choices are becoming more in line with personal values, especially among younger generations. It includes shopping at small businesses. Amazon reacted to this by supporting small companies.
Thanks to a new benefit known as Buy With Prime, members could look at offers outside Amazon’s shop. When users made purchases directly from partner brands’ websites, the function gave members who were based in the United States the same advantages and reliability as Prime.
On Amazon, promotions were displayed through various channels, including in-store banners inside the Amazon shop, content created by influencers, and online awareness campaigns.
Collectively, participating retailers saw a 10-fold increase in daily orders through Buy With Prime. Amazon looked for creative ways to entice customers to make purchases.
For instance, Amazon partnered with the online travel agency Priceline to provide special rates for Prime Day. Prime Day numbers were included in Amazon’s financial report for the second quarter even though it happened after the quarter ended on June 30.
By the Numbers on Amazon
Amazon’s net sales increased 11% to $134.4 billion in the second quarter from $121.2 billion in the same quarter of 2022.
Sales in the North American region increased by 11% to $82.5 billion. Sales in the overseas market increased by 10% from the prior year to $29.7 billion.
In the second quarter, operating income more than doubled to $7.7 billion from $3.3 billion in the corresponding time in 2022. Operating income in North America increased to $3.2 billion from a $0.6 billion loss year over year. An improvement from the operating loss of $1.8 billion in the second quarter of 2022, the international division had an operating loss of $0.9 billion. $6.7 billion was the net profit. Source
