Amazon reduces losses from international business, reaffirms commitment to India1 min read . Updated: 27 Jul 2018, 11:14 PM IST
Amazon's latest numbers for its international business halts a run of rapidly increasing losses, due to its frenetic pace of investments in geographies like India
Bengaluru: Amazon, the world’s largest online retailer, reported narrower losses from its international business, bucking a trend of increased losses over the past few quarters, as it reaffirmed its commitment toward its most important international market, India, where it has pledged to invest at least $5 billion.
In a post-earnings conference call with investors on Friday, Amazon’s chief financial officer Brian T. Olsavsky attributed the narrower losses to “operating efficiencies" and a growing ad business, which has started to shore up its profits. For the latest quarter, the Seattle-based e-commerce giant posted losses of $494 million, compared with $724 million last year.
“I would say that, in addition to the operating efficiencies, advertising is also starting to make an impact on gross profit. Although advertising is smaller in International segment than it’s in North America, it’s growing at a same rapid clip year-over-year," said Olsavsky.
Amazon’s latest numbers for its international business halts a run of rapidly increasing losses, due to its frenetic pace of investments in geographies like India, which has been a top priority for Amazon chief executive Jeff Bezos since his company launched here in 2013.
“We continue to invest. We’re investing in India obviously, and have seen good traction there. We just passed our fifth year anniversary – celebrated our fifth year anniversary, as the most visited site in India. So we think there’s a lot of great innovation that has continued to occur for Indian consumers and sellers, and that will continue," Olsavsky said.
Amazon is locked in a bitter and expensive market share battle with local rival Flipkart, which was acquired by Walmart in May. While Flipkart continues to be the market leader in the online retail business in India, Amazon believes that it can catch up and overtake Flipkart over the next few years. Over the past six months, Amazon has repeatedly claimed that it is already larger than Flipkart, although Flipkart remains ahead in terms of gross monthly sales, according to at least four executives from both companies.