Amazon posts record quarterly profit as consumers turn to online retailer

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Amazon posts record quarterly profit as consumers turn to online retailer Inc. on Thursday reported its biggest profit ever as consumers turned to the online retailer for their shopping needs and businesses paid much more in order to sell and warehouse their products.

Since the start of the USA coronavirus epidemic, shoppers have relied on Amazon to receive their home staples and supplies.That has kept the world's largest online retailer in the center of workplace tumult.The warehouse in Bessemer, Alabama this winter became a rallying point for organized labor, hoping that staff would join Amazon's first American federal union and inspire nationwide similar efforts.Workers ultimately rejected the union bid by a more than 2 to 1 margin, but Chief Executive Jeff Bezos said the saga showed how the company had to do better for employees.

The company is facing litigation in New York over whether it has put profit first in COVID-19 pandemic and putting worker safety in the UK.

Amazon's operations have been depressed by these developments.

Net sales increased on March 31 to $108.52 billion from $75.45 billion in the first quarter, beating analysts' average estimate of $104.47 billion according to IBES data from Refinitiv.

Bezos touted the results of a cloud computing business of Amazon Web Services in a press release, saying that as of 15 years, AWS has become a $54bn per year run rate business which is competing with the largest technology companies and its growth is accelerating.

Bezos, who had been CEO of Amazon for a year, is scheduled to succeed Andy Jassy as CEO of AWS this summer, said that the unit remains a bright spot.Just last week, for example, AWS announced a deal to build its network on 5 G on Dish Network Corp.The unified revenue increased to $13.5 billion, ahead of forecasts of $13.2 billion.

Amazon added to its sales by its growing chain of physical stores, including Whole Foods Market and its first overseas cashier-less convenience shop, which opened in the London Borough of Ealing last month.Amazon entered further into the industry with an online doctors-visit service for employers, another area it is aiming to disrupt after retail, enterprise technology and Hollywood.

Profit has now tripled to $8.1 billion.

Amazon, which saw its stock price nearly double in the first part of 2020 as it benefited from the pandemic, has been underperformed by the S&P 500 market index in this year.Its shares were up about 8.5% year to date versus the index's 13% gain.

At the same time, Amazon's revenues on COVID - 19 and logistics have chipped away at Amazon's revenue.The company has poured money in buying cargo planes and securing new warehouses, aiming to place goods closer to customers to speed up delivery.It said Wednesday it plans to increase pay for over half a million employees, which will cost more than $1 billion - and it is still hiring for tens of thousands more positions.

Amazon said that it anticipates operating revenue for the current quarter to be between $4.5 billion and $8 billion, which assumes an estimated $1.5 billion of costs related to COVID - 19.

While Amazon is far behind the Ad sales leaders Facebook Inc and Alphabet Inc. Google, Amazon is doing business because advertisers' placements can often result in a direct sales, reaching consumers who are on Amazon with an intention to shop online.Amazon said ad and other sales rose 77% to $6.9 billion, ahead of analysts' estimate of $6.2 billion.

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