Amazon Warns High Holiday Costs Could Mean $0 Profit
(Bloomberg) -- Amazon shares sank as much as 5.4% in postmarket trading Thursday after the online retailer scared investors by warning that it could have sales of up to $140 billion in the busy holiday quarter without making a nickel in profit.
Investors have grown used to fatter profit margins from Amazon, even through the pandemic when it had to spend billions on safety measures. The holiday outlook shows investors take a back seat to customers, and that new CEO Andy Jassy is not abandoning the long-time strategy of founder Jeff Bezos. It’s almost a message from Jassy: Don’t expect anything different from me.
Amazon sees the long-term value in delivering what customers want at any cost. It will help it gobble more market share and potentially woo the few remaining people in the U.S. who aren’t yet Amazon Prime members to subscribe.
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