Amazon says COVID-related expenses will cost $4B this quarter

By the time this fiscal quarter is through, Amazon estimates it will have spent more than $11 billion on coronavirus-related expenses. T...

By the time this fiscal quarter is through, Amazon estimates it will have spent more than $11 billion on coronavirus-related expenses.

The e-commerce titan said during its Thursday earnings report that it expects to spend around $4 billion battling the virus, on top of the $7.5 billion in costs it has already rung up since March.

First quarter coronavirus expenses cost Amazon $600 million, with the number ballooning to $4 billion during the peak of the pandemic and decreasing slightly to $2.5 billion in the most recent quarter, the company said.

Investments included personal protective equipment for Amazon’s workforce — which it announced on Thursday has hit 1 million — “enhanced cleaning” of its facilities, higher wages for hourly workers as well as “hundreds of millions” of dollars for Amazon to develop its coronavirus testing capabilities.

Much of the increased costs are related to “the large influx of new employees hired to support strong customer demand,” CFO Brian Olsavsky said on a call with analysts.

The Seattle-based e-tailer’s guidance on operating income for the quarter was $1.5 billion to $4 billion, and already factored in the Covid-related spending.

Olsavsky said that the pandemic, along with the upcoming election and the fact that the company’s Prime Day shopping extravaganza was delayed until October this year, has created a lot of uncertainty for the holiday quarter.

Shares of Amazon were down 4 percent Friday morning, trading at $3,082.99.

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Newsrust: Amazon says COVID-related expenses will cost $4B this quarter
Amazon says COVID-related expenses will cost $4B this quarter
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