Amazon.com Inc. (NASDAQ:AMZN) shares began Friday and the month of May on the wrong foot, as the on-line retail behemoth reported downbeat earnings for its first quarter, while sales exceeded estimates. Amazon said it expects second-quarter sales $75 billion to $81 billion.
Amazon’s expected expenditures going forward also could deliver a hit to the company in the coming quarters.
Bezos’s fortune, meanwhile, has surged by more than $24 billion since the pandemic took the broader market for a roller-coaster ride, according to Fortune. That rise has lifted his net worth to a stunning $148.6 billion, according to Forbes, making him by far the richest person in the world, even after relinquishing much of his wealth to his partner in divorce proceedings back in July.
AMZN reported first-quarter earnings of $2.5 billion, or $5.01 a share, down from $3.56 billion, or $7.09 a share, in the year-ago period.
Revenue grew to $75.5 billion from $59.7 billion in the year-ago period. Analysts had estimated $6.23 a share on revenue of $73.7 billion on average.
For the second quarter, the company said it could report operating losses of up to $1.5 billion, though the high end of its guidance was for $1.5 billion in operating profit, a wide range that shows the inability to project results in a difficult time. Analysts had expected more than $4 billion in operating profit in the second quarter, but CEO Jeff Bezos said he expects to spend that and possibly more.
The jump in expenses will come from spending “hundreds of millions of dollars” developing testing capabilities for all of its employees for COVID-19, starting with front-line workers; personal protective equipment for the company’s hundreds of thousands of employees; “enhanced cleaning” of its facilities; and “higher wages for hourly teams.”
Shares faltered $137.11, or 5.5%, to $2,376.89