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Amazon Plans To Spend Over $4 Billion On COVID-19 Related Expenses

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Amazon says it expects to spend over $4 billion on COVID-19 related expenses. CEO, Jeff Bezos said Amazon will spend the amount on personal protective equipment (PPE), cleaning of its facilities, and “higher wages for hourly teams”.

 

The spending will also go towards expanding its COVID-19 testing capabilities. In a statement from the company’s boss, he says it will keep delivering to homes and raise its safety standards.

 

“If you’re a shareowner in Amazon, you may want to take a seat, because we’re not thinking small. The best investment we can make is in the safety and well-being of our hundreds of thousands of employees,” Bezos told investors.

 

He further said:

 

“Under normal circumstances, in this coming Q2, we’d expect to make some $4 billion or more in operating profit. But these aren’t normal circumstances.

 

“Instead, we expect to spend the entirety of that $4 billion, and perhaps a bit more, on COVID-related expenses getting products to customers and keeping employees safe,”.

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Amazon made $75 billion in sales in the first quarter of 2020. The company’s profit, however, declined year-on-year as COVID-19 spread, affecting its non-essential businesses.

 

Amazon Covid-19 expenses
Bezos says Amazon will spend on COVID-19 related expenses this quarter. Photo: Andrej Sokolow/picture alliance via Getty Images

 

Executives added that the company has witnessed changes in consumer behavior. They note that customers are flocking to essential areas like groceries.

 

“We have seen an increase in demand in online grocery shopping,” said Dave Fildes, Amazon director of investor relations.

 

Amazon’s chief financial officer, Brian Olsavsky was asked what the company has learned during the pandemic. In reply, Olsavsky said:

 

“We’ve learned that it’s easier to get ready for a holiday or for a Prime Day than it is to get ready for something like this when everything hits all at once.”

 

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