[ad_1]
Amazon has said it witnessed 60 per cent growth in customer additions in India, thanks to its festive season sales that started in early October. Growth came on the back of yet another quarter of subdued rise of international sales, which include those in India, in the third quarter.
On a call with badysts on Thursday, Brian T Olsavsky, chief financial officer at Amazon.com, attributed part of the slowdown in the growth of international business to festive sales in India being pushed to the fourth quarter, unlike in the previous year. The company reported a revenue of $15.5 billion from its international business during the quarter.
“On a year-over-year basis, I think you have to look at two things. We did the Souq acquisition last year in May. So the full pick-up on that year-over-year was in 2017 and now we’re lapping that. There’s also material change in the Diwali calendar in India. About half of our Diwali sales last year were in Q3. This year they’ll be fully in Q4,” Olsavsky said.
While the growth of its earnings from the international markets slowed, Amazon continued to reduce its losses, which came down to $385 million in Q3 from $494 million in Q2. On a YoY basis, that represents a nearly 2.5 times reduction in losses from international sales for Amazon, which had reported a loss of $936 million in Q3 2017.
This comes despite Amazon continuing to invest heavily in India, with the investment pegged to top $2 billion in the current fiscal year. The company has already pumped in over 77 billion in three tranches of Rs 26 billion, Rs 23 billion and Rs 27 billion into its India business in May, July and August, respectively.
Amazon has said it will keep investing in India because it sees a good uptick in sales and its far-reaching presence in the country. “India, although Diwali moved into Q4, so far that’s going really well. We’ve seen great response from customers. We’ve had 6 per cent growth in new customers during the period. Orders are coming in from 99 per cent of the pin codes in the countries. So, great first wave of we call the Amazon’s Great Indian Festival, which just lead into Diwali,” added Olsavsky.
Amazon reported record profits of $2.9 billion for Q3 on Thursday, with sales climbing nearly 30 per cent to $56.6 billion. But investors penalised the stock for missing estimates, which had been set higher due to expectations of strong sales performance during the Prime Day sales event.
While Amazon’s stock price was up 7 per cent at $1,782.17 when the markets closed, it fell to $1,668.01 in after-hours trading.
[ad_2]
Source link
