Amazon sees double-digit growth in Q3

Amazon announced another quarter of year-over-year growth at its third-quarter earnings call on Thursday, reporting net sales of $87.9 billion in North America, an 11% increase over the prior year. 

While there was barely a mention of its grocery business during the earnings call, the Seattle-based retail giant said net sales at its physical locations increased 6% year over year, to $4.96 billion. That figure is down slightly from the previous quarter, when net sales at brick-and-mortar stores such as Whole Foods, Amazon Fresh and Amazon Go, topped $5 billion.  

Amazon CEO Andy Jassy said the company’s Prime Big Deal Days, held October 10-11, “was our most successful October holiday kickoff event ever.” 

Similarly, Amazon Prime Day, held on July 10-11, was the biggest sale in the company’s history, with members purchasing more than 325 million items, according to Amazon Chief Financial Officer Brian Olsavsky. 

“Outside of Prime Day, we’ve continued to see strong demand for everyday essentials, including categories like beauty and health and personal care,” Olsavsky said.  

He added that customers remain cautious about price and are seeking deals and trading down on brands when possible. They’re also spending less on discretionary items, Olsavsky added.  

Jassy attributed much of the Q3 success to the overhaul of Amazon’s fulfillment network.  

“Our move earlier this year from a single national fulfillment network in the US to eight distinct regions represents one of the most significant changes to our fulfillment network in our history,” he said. “This change has gone more smoothly and made more impact than we optimistically expected. And you can see the benefits in many forms. Regional fulfillment clusters with higher local and stock levels and optimized connections between fulfillment centers and delivery stations means shorter distances and fewer touches to get items to customers.” 

Although neither Jassy nor Olsavsky discussed the advances the company is making in the pharmacy sector, it noted in its third-quarter results report that it is continuing its work in the field. That includes "an expanded Amazon Clinic virtual health care marketplace now available across the U.S. to provide care for more than 35 conditions, and 60-minute delivery of medications through Amazon Pharmacy using Prime Air drones in College Station, Texas.”  

The retail giant’s Amazon Pharmacy developed a “first-of-its-kind" model with Blue Shield of California to reduce the cost of pharmacy care for Amazon Prime members beginning in 2025. 

Olsavsky said Amazon is well-positioned for the coming holiday shopping season. “As we head into the fourth quarter, we are ready to make this a great holiday season for our customers,” he said. “Looking at our operations network, our inventory is the best positioned it's ever been heading into the holiday season, enabling us to serve customers with fast delivery speeds from their local regions.”