Amazon's rising shipping costs are eating into its profits
It turns out that one-day shipping is an expensive endeavor. Amazon reported worse-than-expected profits in its latest quarter, thanks in part to an aggressive effort to slash delivery times down to one day for items ordered on its site.
Amazon’s shipping costs surged by 36% to over $8 billion in the last quarter. That is a sharp uptick when compared with the previous three quarters, when shipping costs had risen by around 20%. Amazon has stepped up its investment in its shipping capabilities after promising in April that it would make one-day shipping the new normal for members of Amazon Prime, rather than the two-day shipping that it has long offered.
Bezos has made an Amazon Prime membership, which carries a price tag of $119 a year, a staple in over 100 million households across the country. A big part of the draw is free shipping on millions of items. Amazon has sought to stay ahead of the curve here as retailers like Walmart and Target pile on with free shipping offers of their own, which typically require a minimum order size but don’t charge an annual fee.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Amazon Prime's 1-day shipping cuts into 2Q profitsAmazon's investment into one-day shipping for Prime customers has a cost — a break in its record-breaking profit streak.
Read more »
Buffett buys more Bank of America stock, with stake’s value rising to $29 billionBank of America Corp. is by far Warren Buffett’s favorite bank, as his Berkshire Hathaway Inc. has boosted its stake in the moneycenter bank to more than $29...
Read more »
Rising temperatures will put 1 billion more people at risk of infectious disease, Morgan Stanley warnsMorgan Stanley warns that a rise in tropical diseases is an 'underappreciated consequence' of rising temperatures. The firm estimates that an additional 1 billion people will be at risk of infection by 2080, and that up to $125 billion in incremental vaccinations will be needed.
Read more »
11 places in the US where home values just keep risingIf you are looking to buy a home soon, getting into these 11 markets may very well be worth the move.
Read more »
Farming is tougher than ever. Young Britons can’t wait to get startedThe number of agriculture students is rising, despite the threat Brexit poses to Britain’s farmers
Read more »
Oman not mediating in escalating regional tensions: Oman ministerOman is not undertaking any mediation efforts around rising tensions in the Gulf...
Read more »