Amazon beats expectations with net sales up 7% but records $2bn second-quarter loss

Amazon has beaten expectations with an increase in net sales of 7% to $121.2bn (£99.2bn) in the second quarter of 2022, compared with $113.1bn (£92.6bn) in the same period last year. 

The e-commerce giant’s results were higher than the $119bn (£97.6bn) forecast by analysts. However, the company recorded a net loss of £2bn in the second quarter, attributed partly to its investment in electric car manufacturer Rivian, which it is starting to use to make deliveries in the US. Sales in its online business also fell 4% to $50.8bn (£42bn) during the period.

Andy Jassy, c.e.o., said: “Despite continued inflationary pressures in fuel, energy, and transportation costs, we’re making progress on the more controllable costs we referenced last quarter, particularly improving the productivity of our fulfilment network.” 

The company warned it will slow its global recruitment drive, prioritising software engineers but being cautious over hires for other departments.

Brian Olsavsky, c.f.o., said: “We will continue to add headcount but are also mindful of the economic condition.”

The retailer’s cloud business, Amazon Web Service, is still performing strongly, posting a profit of $5.7bn (£4.7bn) in the period, compared to $4.2bn (£3.4bn) in the same period last year.  

Amazon said it expects net sales between $125bn (£102bn) and $130bn (£106bn) for the third quarter, a potential surge of as much as 17% from last year. 

In its highlights, it reported that customers in Lockeford, California, and College Station, Texas, will be among the first to receive Prime Air drone deliveries in the US.  

It also filed legal action against the administrators of more than 10,000 Facebook groups that attempt to orchestrate fake reviews on its site in exchange for money or free products. Amazon said it will use information discovered from this legal action “to identify bad actors and remove fake reviews commissioned by these fraudsters that haven’t already been detected by Amazon’s advanced technology, expert investigators and continuous monitoring”.