Amazon to spend nearly $1bn halving Prime delivery times
Amazon is set to half delivery times for its Prime customers, setting aside nearly $1 billion to offer free one-day delivery for all its paying members.
The ecommerce giant has said it intends to spend $800 million (£620 million) over the second quarter to roll out the one-day delivery to all of its Prime customers, although it hasn’t revealed information about a specific timeframe or how many products would be eligible.
“Our goal is to evolve the two-day free shipping programme into a one-day free shipping programme,” chief financial officer Brian Olsavsky said during an earnings call.
Although members in some countries, including the UK, get free one-day or even same-day delivery as standard, this move will see its largely focus on its key home market in the US, which currently only offers two-day delivery as standard.
“Most of the spend we are seeing in [the second quarter] is starting in North America, but this intended to be a global improvement in speed,” Olsavsky added.
This came as Amazon unveiled its first quarter results, which saw it more than double its net income to from $1.6 billion (£1.24 billion) to $3.6 billion (£2.79 billion), beating analyst estimates by some margin.
Meanwhile revenues rose 17 per cent to $59.7 billion, hitting the top end of expectations of between $56 billion (£43.3 billion) and $60 billion (£46.5 billion).
Despite also doubling its profits during the quarter, it marked the lowest year-on-year revenue growth since 2015.
Looking ahead, Amazon said it expected net sales to rise between 13 and 20 per cent over the next quarter, hitting between $59.5 billion (£46 billion) and $63.5 billion (£49.2 billion).