Amazon expects to spend $4 billion or more — the predicted operating profit for the company’s entire coming quarter — just on COVID-19-related expenses. In a quarterly earnings release today, Amazon CEO Jeff Bezos said the expenses will come from spending on personal protective equipment (PPE), cleaning for facilities, “higher wages for hourly teams,” and expanding its own COVID-19 testing capabilities.
Many of the changes have been put in place already and came in response to pressure over treatment of workers during the pandemic. Amazon is under fire for its handling of employees who have publicly criticized working conditions; it fired six tech employees who took a sick day in protest of Amazon’s treatment of workers, and there has been backlash against the company for reportedly using a heat map to track Whole Foods stores that are at risk of unionizing.
Bezos’ note tries to make Amazon sound serious about “keeping employees safe,” telling shareholders to “take a seat” while the company ramps up this spending. “The best investment we can make is in the safety and well-being of our hundreds of thousands of employees,” Bezos writes.
One of the more interesting bits from Bezos’ statement was that Amazon has a team of current employees that are working to build “incremental testing capacity.” So far, the team has built a lab to pilot tests for its frontline employees, and it pledges to share any progress the team makes to the greater effort against COVID-19.
Amazon’s Q1 2020 performance fell in line with its guidance from late last year, with $4 billion in operating income. Its net sales were at $75.5 billion, which outpaced the growth that it expected last quarter. AWS, its cloud computing services, saw a huge increase year over year, bringing in $10.2 billion this quarter, which is up from $7.7 billion in the same quarter in 2019.
Against the backdrop of the COVID-19 pandemic, these numbers reveal that Amazon — at least so far — is rolling with the punches and keeping up with the unprecedented demand seen for orders around the globe. That it’s publicly pledging a tremendous amount of money toward COVID-19 efforts is notable as well. Although Amazon is on a hiring spree to keep up with demand — no doubt a good thing for people in need of work — it doesn’t overshadow the controversy surrounding its treatment of employees during this difficult time.
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