San Francisco, Oct 29 (IANS) Amazon has been severely hit by labour supply shortages, increased wage costs and global supply chain issues, resulting in its net income decreasing to $3.2 billion in the third quarter (Q3), compared with $6.3 billion in the same period last year.
Amazon shares were down more than 4 per cent in extended trading after the company reported weaker-than-expected results late on Thursday, along with giving poor guidance for the holiday quarter (Q4).
In a statement, Amazon CEO Andy Jassy said that in the fourth quarter (Q4), the company expects to “incur several billion dollars of additional costs in its consumer business”.
This is because Amazon is managing “through labour supply shortages, increased wage costs, global supply chain issues, and increased freight and shipping costs — all while doing whatever it takes to minimise the impact on customers and selling partners this holiday season,” Jassy informed.
“It’ll be expensive for us in the short term, but it’s the right prioritisation for our customers and partners,” he added.
Amazon reported revenue of $110.81 billion (vs $111.6 billion expected) in the September quarter.
For the fourth quarter, Amazon forecast sales between $130 billion and $140 billion, representing growth between 4 per cent and 12 per cent.
“Our revenue guidance for the fourth quarter reflects the current trends we are seeing. We are dealing with labour risks and supply chain interruptions, like many other companies, which increases our range of potential outcomes in Q4,” said Brian T Olsavsky, SVP and Chief Financial Officer.