Amazon record net losses of $2.7bn in 2022


Amazon has released its FY2022 results, with net sales increasing by 9% y-o-y to $514bn in 2022, compared with $469.8bn in 2021. Operating income however decreased to $12.2bn in 2022, compared with $24.9bn in 2021, whilst net loss was $2.7bn in 2022, compared with net income of $33.4bn in 2021.

Net sales in the North America segment sales increased 13% y-o-y to $315.9bn. Operating expenses in North America increased quicker however to $318.7bn, up from $262.6bn the previous year, with Amazon recording operating losses of $2.8bn. 

The international segment saw sales decrease by 8% y-o-y to $118bn, recording an operating loss of $7.7bn.

AWS saw sales increase by 29% y-o-y to $80bn, whilst operating income rose to $22.8bn, up from $18.5bn in 2021.

Fulfilment operating expenses rose to $84.3bn for the twelve months ending December 31, up from $75.1bn in 2021. Fulfilment costs primarily consist of those costs incurred in operating and staffing our North America and International fulfilment centres, physical stores, and customer service centres and payment processing costs. According to Amazon, the increase in fulfilment  is primarily due to variable costs corresponding with increased product and service sales volume and inventory levels, increased wage rates and incentives and fulfilment network inefficiencies resulting from a constrained labour market and global supply chain constraints, and costs from expanding Amazon’s fulfilment network.

Commenting on the results, CEO Andy Jassy said: “In the short term, we face an uncertain economy, but we remain quite optimistic about the long-term opportunities for Amazon. The vast majority of total market segment share in both Global Retail and IT still reside in physical stores and on-premises datacenters; and as this equation steadily flips, we believe our leading customer experiences in these areas along with the results of our continued hard work and invention to improve every day, will lead to significant growth in the coming years”.

For the first quarter of 2023, Amazon offered the following guidance: Net sales are expected to be between $121.0bn and $126.0bn , or to grow between 4% and 8% compared with first quarter 2022. This guidance anticipates an unfavourable impact of approximately 210 basis points from foreign exchange rates. Operating income is expected to be between $0 and $4.0bn, compared with $3.7bn in first quarter 2022. This guidance assumes, among other things, that no additional business acquisitions, restructurings, or legal settlements are concluded.

Source: Amazon