Amazon has announced its financial results for the first financial quarter ended March 31, 2020.
Net sales increased 26% to $75.5bn in the first quarter, compared with $59.7bn in the first quarter of 2019. Operating income decreased to $4.0bn in Q1 2020, compared with operating income of $4.4bn in Q1 2019. Net income decreased to $2.5bn in Q1 2020, compared with net income of $3.6bn in the first quarter 2019.
Operating cash flow increased 16% to $39.7bn for the trailing twelve months, compared with $34.4bn in 2019. Free cash flow increased to $24.3bn for the trailing twelve months, compared with $23.0bn in 2019.
“From online shopping to AWS to Prime Video and Fire TV, the current crisis is demonstrating the adaptability and durability of Amazon’s business, but it’s also the hardest time we’ve ever faced,” said Jeff Bezos, Amazon founder and CEO. “The service we provide has never been more critical. Under normal circumstances, in this coming Q2, we’d expect to make some $4bn or more in operating profit. But these aren’t normal circumstances. Instead, we expect to spend the entirety of that $4bn, and perhaps a bit more, on COVID-related expenses getting products to customers and keeping employees safe. This 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.”
In Q2 2020, net sales are expected to be between $75.0bn and $81.0bn, or to grow between 18% and 28% year-on-year. Operating income is expected to be around the range of $1.5bn, compared with $3.1bn in Q2 2019. This guidance assumes approximately $4.0bn of costs related to COVID-19.
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