Amazon Inc (NASDAQ:AMZN) is planning to invest at least US$4bn to ramp up capacity and safety measures in its locations.
Founder and chief executive Jeff Bezos told shareholders to “take a seat”.
“Under normal circumstances, in this coming Q2, we’d expect to make some US$4bn or more in operating profit,” he said.
Now, operating income for the quarter to June could be between US$1.5bn and a US$1.5bn loss after factoring in the extra investment.
“As well as the obvious health benefits for Amazon’s 840,000 employees this could mark a watershed moment for client acquisition and sacrificing a single quarter’s profits to secure political and public goodwill would have long term advantages,” commented Nicholas Hyett, analyst at Hargreaves Lansdown.
Net sales are expected to jump by 18-28% to US$75-81bn as worldwide lockdowns keep driving online shopping demand.
In the quarter to 31 March, sales climbed 27% to US$75.5bn compared to last year, for operating income down 9% to US$4bn.
Shares dropped 5% to US$2,356 in after-hours trading.