Amazon’s Q2 net income doubles to $5.2 billion

Net sales increased 40 per cent to $88.9 billion in the second quarter, compared with $63.4 billion in second quarter 2019. Excluding the $582 million unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 41 per cent compared with second quarter of 2019.

Operating income increased to $5.8 billion in the second quarter, compared with operating income of $3.1 billion in second quarter of 2019.

Net income increased to $5.2 billion in the second quarter, or $10.30 per diluted share, compared with net income of $2.6 billion, or $5.22 per diluted share, in second quarter of 2019.

Operating cash flow increased 42 per cent to $51.2 billion for the twelve-month period ended June 2020, compared with $36.0 billion for the comparable period ended 30 June 2019.

Free cash flow increased to $31.9 billion for the twelve months ended 30 June2020, compared with $25.0 billion for the previous twelve months ended 30 June 2019.

Free cash flow less principal repayments of finance leases and financing obligations increased to $21.3 billion for the twelve months, compared with $16.1 billion for the previous twelve months ended 30 June 2019.

Free cash flow less equipment finance leases and principal repayments of all other finance leases and financing obligations increased to $19.4 billion for the twelve-month period, compared with $13.0 billion for the twelve months ended 30 June 2019.

Common shares outstanding plus shares underlying stock-based awards totaled 517 million on 30 June 2020, compared with 510 million an year ago.

Amazon said it has created over 175,000 new jobs since March and is in the process of bringing 125,000 of these employees into regular, full-time positions. 

And, even during these unpredictable time, Amazon said, its third-party sales grew faster during the quarter when compared to first-party sales, adding that the company injected significant money into the economy, investing over $9 billion in capital projects, including fulfillment, transportation, and Amazon Web Services.

“This was another highly unusual quarter, and I couldn’t be more proud of and grateful to our employees around the globe,” said Jeff Bezos, Amazon founder and CEO. “As expected, we spent over $4 billion on incremental Covid-19-related costs in the quarter to help keep employees safe and deliver products to customers in this time of high demand—purchasing personal protective equipment, increasing cleaning of our facilities, following new safety process paths, adding new backup family care benefits, and paying a special thank you bonus of over $500 million to front-line employees and delivery partners. 

Amazon said the company spent more than $4 billion in the second quarter on incremental Covid-19 related initiatives to help keep employees safe, provide additional compensation to employees and delivery partners, and deliver products to customers.

Amazon provided a one-time Thank You bonus totaling over $500 million to all front-line employees and partners who were with the company throughout the month of June.

Amazon has been active in care programmes in the US, Australia, Japan, Singapore, Spain, the UK and India.

Amazon said it is on a path to run on 100 per cent renewable energy by 2025, five years ahead of schedule. As part of The Climate Pledge, Amazon had previously committed to reach 80 per cent renewable energy by 2024 and 100 per cent renewable energy by 2030.

Amazon in its 2020 Small and Medium-Sized Business (SMB) Impact Report highlighted how SMBs selling in its US store have sold more than 3.4 billion products in the past year and created an estimated 1.1 million jobs.

In partnership with the British small business support network “Enterprise Nation,” Amazon launched the Amazon Small Business Accelerator, which aims to support more than 200,000 small businesses across the UK negatively impacted by the COVID-19 crisis. 

Amazon in India announced plans to help digitally enable micro, small, and medium businesses across the country as part of a $1 billion investment pledge. Amazon launched Local Shops on Amazon.in, offering shopkeepers and retailers with physical stores the ability to register to serve more customers from their local areas. Amazon also introduced seller registration and account management services in Hindi to help businesses overcome language barriers. Since launch, more than 10,000 sellers have used Hindi to register on Amazon.in.

Amazon increased grocery delivery capacity by over 160 per cent and tripled grocery pickup locations to support customers during Covid-19. Online grocery sales tripled in the second quarter when compared with the same period last year.

Amazon now reaches beneficiaries in 39 states and the District of Columbia, providing more than 90 per cent of SNAP households with the ability to use their SNAP benefits online.

Amazon.com said its expectations as of 30 July 2020 are inherently unpredictable and may be materially affected by many factors, such as fluctuations in foreign exchange rates, changes in global economic conditions and customer spending, world events, the rate of growth of the internet, online commerce, and cloud services, and the various other factors, including impact of the Covid-19 pandemic on its operations.