Published: Fri, April 26, 2019
Markets | By Otis Pena

Amazon targets faster delivery

Amazon targets faster delivery

Already, the company's Amazon Prime program has been offering one-day, same-day, and two-hour shipping times, but only in certain zip codes and for a limited number of products.

Seattle-based Amazon said revenue from online sales was up 10 percent billion while money taken in from subscription services and the Amazon Web Services cloud platform leapt some 40 percent.

Amazon's operating expenses rose 12.6 per cent in the quarter to US$55.28 billion as it invested in electric-car maker Rivian and self-driving auto startup Aurora and continued spending on its Prime program, grocery delivery from Whole Foods stores and original video content.

"While AWS's momentum continues unabated and is clearly the bigger driver of this profit story at the moment, the advertising flywheel now appears to be in full effect for Amazon and will only be a bigger part of the growth story over the near term".

Since its founding 25 years ago, Amazon has grown rapidly into one of the country's largest and most influential companies.

Overall, Amazon reported net income of US$3.56 billion (NZ$5.36 billion), or US$7.09 per share, for the first three months of the year. However, its steady, often successful marches into new industries have been lucrative to shareholders, including its founder Jeff Bezos, who had become the richest man in the world. The area is getting more competitive: Microsoft has also been growing its cloud business, and both Amazon and Microsoft are vying for a multibillion contract with the USA military.

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"As much as the top-line performance matters, Amazon's shallower growth is coinciding with a period of improving profits", Saunders said.

But its breakneck growth has also caught the attention of regulators - and President Donald Trump - who argue that the company's market dominance gives it too much power. The unit's operating income was $2.2 billion, half of Amazon's total.

In China, where the company had long struggled to compete with Alibaba Group Holding Ltd, Amazon said this month it would close warehouses and its domestic marketplace in July.

Amazon says its free shipping for Prime members will be even faster, promising one-day shipping on most items instead of two-day delivery. It has expanded its fleet of jets, has plans to open package sorting hubs at two airports and launched a program previous year that allows contractors around the country to deliver Amazon packages in vans stamped with the Amazon smile logo.

For the second quarter, Amazon expects net sales between $59.5 billion and $63.5 billion.

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