Amazon Turns in Strong Q3 Performance
Some of Amazon’s strategies seem to be paying off, as value-minded shoppers helped fuel unit and dollar sales during the recently concluded third quarter. The company reported an 11% boost to hit $158.9 billion in net sales in that time frame, with a 9% lift in the North American market. Profits also beat expectations, as Amazon’s operating income reached $17.4 billion and its net income topped $15.3 billion in Q3.
The company’s solid performance comes as it continues to invest in technologies, including AI used in its new shopping guides and AI assistants, and is working to streamline experiences for customers, including grocery shoppers who buy across its various channels and formats, including Amazon.com, Amazon Fresh and Whole Foods Market.
In an earnings call, President and CEO Andy Jassy said that those advances and strategies meet the needs of consumers, as they seek the best ways to shop for themselves and their families. "At a time when consumers are being careful about how much they spend, we're continuing to lower prices and ship even more quickly, and we can see this resonating with customers as our unit growth continues to be strong and outpace even our revenue growth," he remarked.
Looking ahead a bit, Jassy that the business is using the third quarter tailwinds as it moves into an especially pivotal quarter. “As we get into the holiday season, we’re excited about what we have in store for customers,” he remarked. “We kicked off the holiday season with our biggest-ever Prime Big Deal Days and the launch of an all-new Kindle lineup that is significantly outperforming our expectations; and there’s so much more coming, from tens of millions of deals, to our NFL Black Friday game and Election Day coverage with Brian Williams on Prime Video, to over 100 new cloud infrastructure and AI capabilities that we’ll share at AWS re:Invent the week after Thanksgiving.”
On that note, Amazon announced on Nov. 1 a new shopping experience called Virtual Holiday Shop that uses immersive 3D technology powered by Amazon Beyond to present interactive content and visuals. Amazon also shared details of its popular Cyber Monday sales event on Dec. 2 that includes deals on everyday essentials and groceries.
Officially, Amazon projects that net sales will grow between 7% and 11% YoY in the fourth quarter, with net sales expected to land between $181.5 billion and $188.5 billion. The company also anticipates operating income to come in between $16 billion and $20 billion for Q4, compared to $13.2 billion during the fourth quarter of 2023.
In the grocery arena, Amazon continues to tinker with operations. The company refreshed and opened new Amazon Fresh stores during that period and recently unveiled an Amazon Grocery pilot store, co-located downstairs from a Whole Foods in Chicago.
Seattle-based Amazon is No. 2 on The PG 100, Progressive Grocer’s 2024 list of the top food and consumables retailers in North America. PG also named the company one of its Retailers of the Century.
