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Amazon makes a loss for the second quarter in a row in their FY Q2 2022 earnings

Amazon today announced financial results for its second quarter ended June 30, 2022.

The company reported a 20c earnings per share loss in the quarter, which it blamed on excess and unneeded capacity now the pandemic has waned, leaving the company with more staff and warehouses than it needed, and a $3.9 billion loss on its Rivian investment.

The company, however addressed this, laying off 99,000 people to bring its staff count to 1.52 million employees as of the end of the second quarter after almost doubling in size during the pandemic.

“Despite continued inflationary pressures in fuel, energy, and transportation costs, we’re making progress on the more controllable costs we referenced last quarter, particularly improving the productivity of our fulfillment network,” said Andy Jassy, Amazon CEO. “We’re also seeing revenue accelerate as we continue to make Prime even better for members, both investing in faster shipping speeds, and adding unique benefits such as free delivery from Grubhub for a year, exclusive access to NFL Thursday Night Football games starting September 15, and releasing the highly anticipated series The Lord of the Rings: The Rings of Power on September 2.”

The market responded positively to Amazon’s forecast for third-quarter revenue between $125 billion and $130 billion, representing growth of 13% to 17%, which its share price popping 13% in after hours trading.

See more of the headline numbers below:

  • Operating cash flow decreased 40% to $35.6 billion for the trailing twelve months, compared with $59.3 billion for the trailing twelve months ended June 30, 2021.
  • Free cash flow decreased to an outflow of $23.5 billion for the trailing twelve months, compared with an inflow of $12.1 billion for the trailing twelve months ended June 30, 2021.
  • Free cash flow less principal repayments of finance leases and financing obligations decreased to an outflow of $33.5 billion for the trailing twelve months, compared with an inflow of $0.6 billion for the trailing twelve months ended June 30, 2021.
  • Free cash flow less equipment finance leases and principal repayments of all other finance leases and financing obligations decreased to an outflow of $26.1 billion for the trailing twelve months, compared with an inflow of $4.2 billion for the trailing twelve months ended June 30, 2021.
  • Common shares outstanding plus shares underlying stock-based awards totaled 10.6 billion on June 30, 2022, compared with 10.4 billion one year ago. All share and per share information throughout this release has been retroactively adjusted to reflect the 20-for-1 stock split effected on May 27, 2022.
  • Net sales increased 7% to $121.2 billion in the second quarter, compared with $113.1 billion in second quarter 2021. Excluding the $3.6 billion unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 10% compared with second quarter 2021.
  • Operating income decreased to $3.3 billion in the second quarter, compared with $7.7 billion in second quarter 2021.
  • Net loss was $2.0 billion in the second quarter, or $0.20 per diluted share, compared with net income of $7.8 billion, or $0.76 per diluted share, in second quarter 2021. Second quarter 2022 net loss includes a pre-tax valuation loss of $3.9 billion included in non-operating expense from our common stock investment in Rivian Automotive, Inc.

See the full numbers here.

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