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Amazon expects the pandemic-fuelled shopping frenzy to continue

Stock up about 45% in the last 12 months.
Image: Bloomberg

Amazon.com Inc., which benefited from a surge in online shopping during the pandemic, expects the trend to continue even as consumers get back to work and resume the vestiges of normal life.

This time a year ago, Amazon chief executive officer Jeff Bezos warned investors that the spread of Covid-19 was going to be costly, in new facilities to meet demand from homebound shoppers and precautions to keep its operations running safely. Amazon hired hundreds of thousands of workers and continued to open warehouses at a rate of one every 24 hours.

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Quarterly results released on Thursday show those big bets continue to pay off. The pandemic has supercharged the retailer’s business, enabling the Seattle-based company to more profitably deliver packages, cloud-computing services and streamed movies.

First-quarter revenue jumped 44% to $108.5 billion and earnings were a record $15.79 a share, exceeding analysts’ estimates. For the quarter ending in June, Amazon projected sales between $110 billion and $116 billion, also better than Wall Street expected.

“Fantastic quarter,” said Poonam Goyal, a senior analyst at Bloomberg Intelligence. “Good all around and shows the staying power of changing consumer habits that will lean more toward digital.”

The shares rose about 2.4% in extended trading. The stock has gained about 45% in the last 12 months.

Amazon said Prime Day, the company’s shopping bonanza for members of its $119-a-year speedy shipping program, will take place in the second quarter. That may help the company’s spring results look rosier compared with a period in 2020 when many people were in the midst of lockdowns and shopping almost exclusively online.

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