Monday, August 26, 2019

Amazon has promised to cut delivery times for customers of its Prime service.

Amazon Prime is a subscription service offering free delivery and access to Amazon’s TV shows.

Members in the US currently receive free two-day delivery, but the plan is to cut that to one day.

In the UK, Prime customers already get free one-day delivery. Amazon plans to spend $800m (£620m) over the next two months to cut delivery times elsewhere.

Amazon also reported a first quarter profit of $3.6bn (£2.8bn), double the same period in the previous year.

It was its fourth successive quarter of record profit.

In the first quarter sales rose 17% to $59.7bn. Amazon expects sales to grow between 13% and 20% in the second quarter.

Cloud computing

Sales surged at Amazon Web Services (AWS), which provides computing services to companies over the internet – a service know as cloud computing.

Launched in 2002, AWS has become a crucial part of Amazon’s business, and sales rose 41% to $7.7bn in the three-month period to the end of March.

“While the cost of building the data-driven infrastructure to support the cloud systems is vast, the fact it requires such deep pockets actually works in Amazon’s favour,” said George Salmon, an analyst at stockbroker Hargreaves Lansdown.

“It’s difficult to see how a new challenger can wrestle business away from the likes of Amazon, Google, and the latest member of the $1tn club, Microsoft.”

Microsoft has seen its stock market value top $1tn after reporting better-than-expected sales and profits.

The US software giant passed the mark briefly on Thursday, before its share price fell back.

Articles and pictures by BCC

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