Amazon is Increasing Its Investments in the Third Quarter Report.

Amazon's Third Quarter Success and Investments

Amazon's third quarter results indicate that the company is focusing on strengthening its transportation and delivery network in preparation for the holiday season. CEO Andy Jassy announced that the company will invest over 4 billion dollars in order to expand its rural delivery network in the U.S. and accelerate fast order fulfillment processes in all regions. This announcement came during Amazon's (NASDAQ: AMZN) third quarter earnings call, where the company reported revenue of 180.2 billion dollars, a 13% annual increase.

Jassy stated, "We’ve increased the number of communities that have access to our Same-Day and Next-Day delivery in rural areas by 60%. Our goal by the end of the year is to reach halfway to the total we plan to serve." He added, "This includes small towns that want fast delivery but where other companies have reduced their services."

The company announced a 1.9 billion dollar investment in its Delivery Service Partner (DSP) program in North America. This further expands a logistics initiative that has received a total of 16.7 billion dollars in investment over the past seven years. DSP funding supports safety programs, driver training, and new technologies for Amazon's growing fleet of small business delivery contractors.

Amazon has continued to deliver the fastest options to its Prime members for the past three years and has launched a three-hour delivery option in some cities in the U.S. In addition to the reinvestment of 1.9 billion dollars in the DSP program announced in the third quarter report, Amazon is expanding one-day food delivery to over 1,000 U.S. cities and plans to increase that number to 2,300 by the end of the year.

The company introduced a new "add to delivery" button that has been used 80 million times. Jassy noted that customers who purchase fresh food through Amazon return twice as often compared to those shopping for durable goods, adding that Amazon plans to hire 250,000 temporary workers in the U.S. for its expanded delivery network and rural services during the holiday season.

At the same time, despite 4.3 billion dollars in legal and compensation costs during the third quarter, the North America segment achieved sales of 106.3 billion dollars, representing an 11% annual increase. However, according to WARN notifications issued to the state of California, Amazon is laying off 1,403 workers. These cuts are part of a broader corporate workforce reduction that will eliminate a total of 14,000 roles, occurring amid reports of Amazon's heavy investments mainly in artificial intelligence technology.