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December 23, 2021

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Amazon's year in review: 2021

Amazon.com, Inc. 2021 Q1 - Results - Earnings Call Presentation

The following slide deck was published by Amazon.com, Inc. in conjunction with their 2021 Q1 earnings call.

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Automation has reached its tipping point for omnichannel warehouses

Never before has the competition for warehouse and fulfillment labor been so fierce, strongly driven by sustained growth in B2C channels. In the United States, for example, employment levels across distribution centers are at all-time highs and wages have risen to well above $18 an hour, yet attracting and retaining warehouse employees remains elusive. In the short term, strategies such as bonuses, accelerated pay raises, and tuition reimbursement are helping. But the long-term implications of a high reliance on labor are clear: automation in warehousing is no longer just nice to have but an imperative for sustainable growth.

About the authors

This article is a collaborative effort by John Barbee, Alan Davies, Raoul Dubeauclard, Tim Lange, and Christoph Lennartz, representing views from McKinsey’s Consumer & Retail Practice.

Fueled by venture capital over the past five years, the automation industry has seen increased availability of new warehouse-automation innovations, supply chain as a service (SCaaS) models, and technology that integrates multiple solutions to help retailers address some of these challenges.

For instance, the adoption of autonomous mobile robots (AMRs), technology that eliminates significant nonproductive walking time in warehouses, has progressed from early-stage pilots about four years ago to multiple at-scale deployments today. For example, DHL rolled out 1,000 Locus Robotics AMRs and will deploy up to 2,000 robots by 2022. 1 Steven Crowe, “Locus Robotics scaling AMR deployments with DHL supply chain,” The Robot Report , June 2, 2021, therobotreport.com. These technologies aren’t just for larger companies. German toy retailer Rofu Kinderland built a new warehouse that includes 57 robots retrieving 3,500 different products from more than 28,000 bins, increasing efficiency and delivery speeds. 2 Melanie Wack, “E-Commerce: AutoStore für Spiel-, Schreibwaren und Dekorationsartikel,” Logistik Heute , November 12, 2020, logistik-heute.de. Innovators are gaining momentum as well. For example, Alert Innovation developed a microfulfillment-center technology platform for Walmart to handle the demands of grocery e-commerce. The proof-of-concept pilot system is now in full operation.

Automation capabilities will play an influential role in the future size and scale of omnichannel networks. To successfully navigate the many choices for automation, retailers must have an informed perspective on where automation can create value, reduce risk, and improve reliability across an increasingly complex network of fulfillment nodes. Retailers should then use a three-step process—strategy, design, and implementation—to translate their vision into an optimal automated warehouse.

The changing face of the warehouse-automation industry

Investments from retailers in automation are poised to fuel significant industry growth: the warehouse-automation market is forecast to reach $51 billion by 2030, a CAGR of 23 percent. 3 David Edwards, “Revenues from robotics in warehouses to exceed $51 billion by 2030,” Robotics and Automation News , August 19, 2021, roboticsandautomationnews.com. The wave of innovation in warehousing has been fueled disproportionately by venture-capital funding for new start-ups, whose solutions increasingly influence the future of the omnichannel warehouse. In addition, private equity has provided a significant tailwind for key companies. For example, SoftBank invested $2.8 billion in AutoStore, an automation provider geared to the e-commerce and grocery industries. 4 Sam Shead, “SoftBank invests $2.8 billion in Norwegian robotics firm AutoStore,” CNBC, April 6, 2021, cnbc.com. Many of these technologies—for example, automated guided vehicles (AGVs) or the next level of automation AMRs as unmanned transport next to warehouse employees—have proved their effectiveness at scale in addressing the challenges of traditional e-commerce warehouses, such as labor shortages, SKU-complexity growth, and increasing service expectations.

Increased M&A and investment

Marketplaces and platform players have long recognized the importance of automation and have been rapidly acquiring robotics companies. Several at-scale investments have grabbed headlines. In 2019, the online marketplace Shopify spent $450 million to acquire automation provider 6 River Systems, with the goal of extending its AI-enabled fulfillment network. 5 Emil Protalinski, “Shopify acquires 6 River Systems for $450 million to expand its AI-powered fulfillment network,” VentureBeat, September 9, 2019, venturebeat.com. Amazon is developing proprietary automation solutions via Amazon Robotics to improve warehouse productivity and lessen the labor burden. Zalando has partnered with multiple automation partners to accelerate consumer-delivery times and improve operating efficiencies.

Several retailers have publicly committed significant capital toward their automation strategies. For instance, Walmart plans to allocate nearly $14 billion for warehouse automation and other business areas, 6 Tonya Garcia, “Walmart to invest nearly $14 billion in automation and other business areas in fiscal 2022,” MarketWatch, February 22, 2021, marketwatch.com. and ASOS announced $100 million in spending to expand the capacity and productivity of its warehouses. 7 “Retailer ASOS to spend $100M to automate Georgia warehouse,” U.S. News, July 12, 2021, usnews.com. These moves are indicative of an industry-wide focus on automation, now even further accelerated as a response to changing market conditions brought about by the COVID-19 pandemic. 8 “Warehouse automation investment up due to COVID-19,” Material Handling and Logistics, July 13, 2020, mhlnews.com; Mark Dunaway, “Why are so many companies investing in warehouse automation?,” Modern Materials Handling, January 10, 2020, mmh.com.

Larger players in the warehouse-automation industry have sought to create distinctive and integrated capabilities through acquisition. For instance, Toyota Material Handling has acquired integrators including Vanderlande and Bastian Solutions, Kion Group has acquired Dematic and software company Digital Applications International, and Honeywell has acquired Intelligrated and Transnorm. Acquirers are seeking to develop more end-to-end solution sets rather than point technologies as they seek to unlock greater value through integrated solutions. The automation market remains concentrated, with the top five automation and material-handling players still accounting for more than 50 percent of current market share. 9 “Warehouse automation market,” LogisticsIQ, 2021, thelogisticsiq.com. Beyond the top ten in each region, players mostly are specialty and niche automation providers.

Automation in action

Leading retailers are aiming to make warehouses responsive, resilient, and reliable to accommodate the ever-growing e-commerce market and incorporate lessons from the global pandemic. Along with improving existing warehouse capabilities and enabling new nodes of fulfillment (such as urban fulfillment centers), they view warehouse automation as an important part of the solution. In a recent McKinsey survey of 50 retailers across apparel, grocery, and other key sectors, more than 80 percent of respondents indicated they intend to increase automation investments over the next two to three years. 10 For more, see “ Retail speaks: Seven imperatives for the retail industry ” on McKinsey.com.

And it’s worth it: some retailers have cracked the code and have begun rolling out ambitious upgrades. As part of a €500 million initiative, Edeka invested €93 million to expand its existing warehouse in Berbersdorf, increasing the total number of SKUs from 2,900 to 12,700 while adding a 300,000-square-foot, partially automated picking-and-storage area. 11 Stefanie Schmitt, “EDEKA Nordbayern-Sachsen-Thüringen erweitert Logistikzentrum in Berbersdorf für rund 93 Mio. €,” EDEKA, March 12, 2021, verbund.edeka.

Leading retailers are aiming to make warehouses responsive, resilient, and reliable to accommodate the ever-growing e-commerce market.

Navigating automation choices

Multiple technological advancements have pushed the boundaries of what is possible in warehouse automation. As part of an overarching automation strategy, retailers that develop an end-to-end vision for the warehouse of the future have to identify the specific use cases and unlock value (Exhibit 1). Navigating the choices has become more complex, with new providers entering the market and larger conglomerates and venture-capital funds pursuing consolidation in an effort to build an integrated portfolio of solutions for clients. Acquisitions within the automation-provider landscape will continue, significantly increasing the pressure on automation companies to offer warehouses end-to-end solutions.

We envision three warehouse archetypes that will inform the design of automation systems: dedicated, shared, and integrated omnichannel (Exhibit 2). These archetypes can help retailers narrow down the set of use cases and solution sets and better understand the complex choices among automation providers, integrators, and start-ups.

Dedicated warehouses

This archetype consists of warehouses specifically designed for a given channel (such as e-commerce), product flow (for example, consolidation), or product type (apparel versus hard goods). Generally, dedicated warehouses solve for scale and cost efficiency in the network. Distribution formats can range from large-scale facilities that cover national distribution needs (more than one million square feet) to smaller, urban-based fulfillment centers (less than 20,000 square feet) that balance same-day and next-day speed with cost efficiency.

Given the specific focus of these distribution formats, integrated and specialized end-to-end automation concepts generally work best. These warehouses benefit from improved space efficiency, greater labor productivity, faster four-wall cycle time, 12 Cycle time from entering until exiting the warehouse. and downstream efficiencies (such as store-friendly pallets). Examples of dedicated warehouses include retail fulfillment (Amazon Go stores), national e-commerce fulfillment (Zara), store replenishment (such as Albertsons and Carrefour), delivery centers for small parcels (Post), and category-specific facilities (such as Reckitt Benckiser and Zalando).

Shared warehouses

Warehouses serving multiple channels or product segments, which may include wholesale and direct-to-consumer (DTC) channels or ambient and perishable-product segments, make up this archetype. While these warehouses exist under the same roof, the operations and inventories are independently managed by channel. This archetype offers greater flexibility than a dedicated warehouse in that multiple channels and categories may be served under one roof or in a campus setting. The multipurpose structure has several benefits: more efficient use of distribution space, cost savings from consolidated labor and overhead, and external advantages such as inbound consolidation. The systems technology and automation may need to support specific flows, handling requirements, and order profiles of each channel. As a result, individual warehouses still operate mostly independently. Automation solutions can still be integrated, but they may combine various fit-for-purpose technologies to address unique channel needs—for example, a retail-store warehouse could be on the side of the building (with automated pallet and case storage where store replenishment orders are prepared), while the e-commerce warehouse could be on mezzanines where individual units are picked with a multishuttle or autostore.

Integrated omnichannel warehouses

Omnichannel warehouses seamlessly serve all channels in the network and generally have the technology and systems to handle inventory across a mostly common stock pool (for example, the same picking locations or an automated storage system). These facilities offer the greatest flexibility in the network and reduce systemwide inventory-carrying costs, but retailers may have to make trade-offs on cycle time, dedicated capacity, and productivity. The set of automation solutions, which may be a hybrid of the capability or shared archetypes, could allow convergence in upstream warehouse processes such as inbound and storage. Distribution operations may have different requirements for fulfillment-execution processes to meet the needs of individual order profiles and channels. For example, online consumers might order small quantities and request a lead time of less than 24 hours, while stores might accept 48-hour or longer lead times with larger volumes being picked and shipped. Hence, the requirements in warehouse operations need to be matched along the steps across channels, balancing the trade-offs of solution benefits.

This archetype, which is best suited for stores that order in eaches 13 A unit of measure where each individual piece is tracked by the computer system. (an approach many apparel and electronics retailers take), can support a shared picking location between stores and online. It provides two benefits: First, it allows inventory pooling and the more efficient use of space. Second, it enables increased scale for automation and the better use of system capacity, with the ability to handle stores and online channels with different seasonality and peaks.

Because each type has its own advantages, identifying and implementing the optimal solution requires an informed decision-making process.

Selecting the right automation solutions

In response to a rapidly changing marketplace, many retailers are moving away from a single solution or turnkey provider and building a portfolio of solutions to fit their network. Traditionally, partnering with a turnkey provider offered advantages, such as integration across multiple solutions and pricing transparency. While this still holds true, the pace of innovation in solutions continues to accelerate, and innovations in technology and operating models provide compelling reasons to explore a multipartner strategy.

For instance, along with technological innovation, many new robotics and automation providers have innovated as-a-service models (XaaS), such as robotics as a service (RaaS) and fulfillment as a service (FaaS). These solutions alleviate the traditional hurdles of up-front capital risk (RaaS helps retailers overcome ROI hurdles such as a payback of two to three years) and offer retailers a variable cost structure better aligned to testing and learning across new technologies and concepts. Because of lower investment levels, retailers are now able to test and learn with selected partners, building up their automation capabilities. Companies can excel in innovation by replacing their tried-and-true approaches to warehouse automation with in-house capabilities to explore earlier-stage implementation. For example, companies can conduct a pilot with AMRs that assist picking operations alongside employees on site. The benefits of this experimentation can be significant—for example, progressing from proof of concept to large-scale implementations.

The range of design and implementation choices varies considerably depending on strategy. An AMR project may require six to eight weeks to pilot, whereas case multishuttles can take 12 months or more to accommodate infrastructure procurement and build-out. In our experience, a three-step process can help retailers determine the right approach to warehouse automation.

Traditionally, retailers might take a site-by-site view of their automation strategy. This exercise includes both establishing criteria for prioritizing automation opportunities and defining business cases to evaluate fit-for-purpose use cases and potential partners for a new or existing operation. We find the more innovative retailers are taking an end-to-end view of their network, developing scenarios for both productivity and short- and longer-term labor risks. A balanced approach to use cases may open up a variety of solutions, while the site-to-site approach focuses solely on payback for individual locations.

In this step—segmented into preconceptual, conceptual, and detailed design—retailers conduct a financial evaluation, create optimized warehouse designs, and select providers by stress testing simulations. The design workshops include retailers, joined by their chosen automation suppliers; beyond them, an objective, informed, third-party perspective—for example, via consultancy—is essential to reach the optimal design. The design process goes beyond the selection of automation to encompass warehouse analytics, strategic network effects, and much more.

Implementation

Where necessary, retailers can identify and select a warehouse-automation system integrator or can orchestrate across a set of partners to build the case-specific automated warehouse. Some companies may also select a logistics service provider to operate the new warehouses and orchestrate the warehouse launch, based on a case-by-case evaluation.

This process has repeatedly captured substantial value because even small decisions (for example, initial product-segment growth assumptions that, in the end, significantly influence automation-picking capacities) have a major impact on projects of this scale. By following this holistic approach, retailers can create a compelling business case for automation and gain buy-in for investments.

The rise of e-commerce in omnichannel has elevated the demand for warehouse automation across industries. Retailers that innovate in this space can keep pace with high consumer expectations for service and personalization. A structured approach helps to pinpoint their current status, identify available and suitable options, and implement warehouse automation and utilization—including harnessing analytics enabled by warehouse automation. With these insights, companies can select the optimal automation for their warehouses.

John Barbee is a partner in McKinsey’s Atlanta office, Alan Davies is a senior expert in the Miami office, Raoul Dubeauclard is a senior expert in the Lyon office, Tim Lange is a partner in the Cologne office, and Cristoph Lennartz is a consultant in the Düsseldorf office.

The authors wish to thank Lucas Clement, Katharina Hauck, and Michael Kalt for their contributions to this article.

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What to buy (and skip) during Prime Day 2024

I’ve been reporting about Amazon Prime Day at NBC Select for five years, and if there’s one piece of advice I have for shoppers, it’s this: be strategic. Not every item that’s on sale is a good deal, and knowing which product categories typically offer the best savings can help you prioritize, budget and narrow down your shopping list.

To find out what products are actually worth buying during Prime Day, I talked to shopping experts from RetailMeNot, Smarty and more. They also advised how Prime members can prepare before the 48-hour event from July 16 to 17. Leading up to Amazon’s mega sale, I’ll continue updating you with shopping tips, early Prime Day deals and other sales to know about from retailers like Target and Walmart.

Want more from our everyday experts, straight to your inbox? Sign up for The Selection , our weekly newsletter packed full of good finds, sales and exclusive content.

SKIP AHEAD What to buy on Prime Day | What to skip on Prime Day | How to save the most money during Prime Day

What to buy on Prime Day

During Prime Day, Amazon offers discounts across all product categories, but a few stand out among experts.

Prime Day is known for deals on personal tech like earbuds , tablets and bluetooth speakers , says Mackenzie Shand, a shopping expert at RetailMeNot. You’ll see Apple , Fitbit , Samsung , Google and more slash prices on their products, but the best sales are typically on devices from Amazon-owned brands. For example, Shand says Echo Dots and Fire TVs will be “hugely discounted.” Also keep an eye on Amazon’s Ring and Blink smart home devices , Kindle e-readers and Eero WiFi systems . Amazon usually discounts these tech products before Prime Day even begins, making them great early deals to take advantage of.

Keep a close eye on apparel deals, says Dr. Ross Steinman, a professor of consumer psychology at Widener University. Earlier this year, Amazon announced that it plans to launch a new section on its website dedicated to low-priced fashion and lifestyle items, which allows Chinese sellers to ship directly to U.S. customers. Shoppers must wait about nine to 11 days to receive their items. Amazon has not specified when it plans to debut this new section, but because it’s in the works, the retailer may use Prime Day to deeply discount related items and see how shoppers respond, says Steinman. Apparel is also one of the top categories shoppers plan to buy from — 46% say they’re looking for sales on clothing, shoes and accessories, according to a 2024 survey by RetailMeNot.

School supplies

Prime Day is one week later this year than in 2022 and 2023, moving it closer to the school year. “It might seem early, but July is actually a popular time for retailers to start running back-to-school sales, and Amazon is no exception,” says Shand. “From backpacks and tablets to kids clothing, you can expect to find several great savings opportunities in this area during Prime Day.” You’ll also see deals on lunchboxes , stationery sets and office supplies like notebooks, pens and pencils.

Beyond wish list items, Prime Day is your opportunity to save on everyday essentials. Think cleaning supplies , pet products , pantry staples and household goods. Amazon’s in-house product lines will likely offer the lowest prices for these categories, says Shand, but you’ll see big-name brands, too.

What to skip on Prime Day

To help you weed out weak Prime Day deals, experts recommend skipping the following categories, if possible.

• TVs : “You can find savings of up to 40% on TVs across the board during Black Friday sales, whereas Prime Day focuses more on select sets, like Fire TVs,” says Shand. If you can, wait to buy large electronics like TVs until later this year, but Fire TVs are well-priced during Prime Day.
• Toys and gaming consoles : There are much better deals on gaming consoles and toys leading up to the winter holidays since people tend to gift these items. You’ll see some gaming consoles on sale during Prime Day, specifically those compatible with Amazon Luna , the retailer’s cloud gaming platform.
• Kitchenware and dinnerware : Most products in these categories see better discounts during Black Friday and Cyber Monday sales, especially if they’re of higher quality and pricier, says Vipin Porwal, CEO and consumer expert at Smarty. However, there are some exceptions, like small countertop appliances and kitchen gadgets , which you’ll find lots of deals on during Prime Day. 
• Furniture and large appliances : More so than Prime Day, these big ticket home items see the best discounts during long holiday weekends like Memorial Day , 4th of July and Labor Day, says Porwal.

How to save the most money during Prime Day 2024

The key to saving during Prime Day is planning, which keeps you focused and ensures you take advantage of the best deals possible. Below are a few ways to be successful during the event.

Sign up to receive notifications about discounts

Amazon offers a variety of tools members can use to get alerted about deals throughout Prime Day. And often, getting alerts for products at the top of your wish list makes all the difference. “We’ve seen more recent Prime Days have better inventories, but many of the best-priced deals have limited supply available, so once it’s gone, it’s gone,” says Porwal. 

With that in mind, use the following tools to get notifications about Prime Day discounts.

• Amazon lists : Add products you have your eye on to Amazon Lists in the retailer’s app or through its website. If items on your lists drop in price, Amazon sorts them into a deals tab, making discounts easy to find quickly.
• Deal alerts : Instead of adding specific products to Amazon Lists, you can opt to receive deals alerts based on your general searches or recently viewed items. Once Prime Day starts, you’ll get alerts about related deals. 
• Alexa deal alerts : Alexa, Amazon’s virtual assistant, can notify you up to 24 hours in advance of a deal going live for items on your lists, in your shopping cart or that you saved for later. You can ask Alexa to remind you when the deal goes live and give her permission to order the item on your behalf using your account’s default payment method and delivery address.

Make shopping lists

Prime Day and comparable savings events are geared toward impulse shopping. Retailers bet on shoppers feeling tempted by deals and adding more items to their carts than originally planned. In fact, 27% of Prime Day shoppers say they often end up purchasing discounted items that were not originally on their lists during the event, according to a 2024 survey by RetailMeNot. That’s why making a shopping list is important: It keeps you organized and reduces the temptation to spend on non-essential purchases.

To create your shopping list, think about products you’ve been meaning to buy, restock or replace — these are your top priorities. Then, consider your wants, like a new pair of jeans or e-reader . If you find a great deal or spend less than you budgeted for, your wants can help guide the rest of your shopping.

Pay attention to featured sellers

During Prime Day, pay attention to products featured on deal homepages, says Porwal. “Those sellers pay a premium to Amazon to feature their best products, often at their lowest prices ever,” he says. “These deals also tend to have time limits, so keep that top of mind.”

On the flip side, be wary of sellers you’ve never heard of. “A lot of Prime Day sale items are overstock inventory that merchants are trying to clear out while they have a massive audience,” says Porwal. “If it’s an item from an unverified seller or a brand you’re not familiar with, and it’s not something you really need, sometimes the savings aren’t worth the risk.” 

Comparison shop

Other retailers host their own summer savings events around Prime Day, which makes comparing prices across sites important. For example, Target Circle Week is happening through July 13, and the Walmart Deals event is from July 8 to 11. We also expect retailers like Nordstrom , Macy’s , Home Depot and Best Buy to host sales within the next two weeks.

As retailers compete for your shopping cart, they tend to “price chase” each other — this means an item sold at multiple retailers will likely have the exact (or almost exact) price tag across the board. In these cases, deciding which retailer to buy from comes down to comparing factors like shipping fees, rewards points, product rebates and cash-back offers, says Porwal. While it’s rare, some retailers may price-match Amazon deals, so inquire if you’re interested.

To help you comparison shop, we recommend using price trackers like Keepa, CamelCamelCamel and Honey. These track prices before and during sales, allowing you to sign up for price drop alerts on specific products.

Consider shopping with a credit card

If you’re interested in using a credit card to shop on Prime Day , you may be able to earn points and cash back or take advantage of exclusive rewards. Certain cards also offer welcome bonuses — for example, Prime members can currently get a $200 Amazon gift card upon approval for a Prime Visa through July 24 or a $80 Amazon gift card upon approval for a Prime Store Card through July 17.

Additionally, as a Prime Day perk this year, Prime cardmembers can earn a total of 7% cash back on eligible Amazon.com purchases when they choose no-rush shipping. Prime cardmembers can also earn 10% back or more on Prime card exclusive deals with Amazon’s Prime Card Bonus .

Frequently asked questions

Lightning Deals are time-sensitive, limited-quantity promotions that go live throughout Prime Day — in years past, they popped up as often as every 10 minutes, says Shand. They’re some of the best savings opportunities available during the event, but shoppers only have a few hours (or less) to add Lightning Deals to their cart and check out. This makes them competitive.

You can’t prepare to shop Lightning Deals since you won’t know what Amazon plans to offer before the sale. However, they usually include popular, in-demand products, says Shand. Keep Lightning Deals on your radar and browse through them during the event in case there’s anything you’re interested in.

Leading up to Prime Day, you can request to shop select invite-only deals that are expected to sell out, like specific beauty products and devices. If you get an invitation to shop the deals during the sale, Amazon will notify you via email and explain how to purchase the items at the exclusive discounted price. You'll also get an email if you requested access to shop an invite-only deal but were not chosen.

You can currently browse invite-only deals on Amazon’s Prime Day homepage. The retailer will add more leading up to the event next week, but for now, you can request invites to shop a pair of Sony headphones for 55% off , a SodaStream bundle for 33% off , a Speedo swim bundle for 40% off and a Citizen watch for 60% off .

Our experts say that early Prime Day deals are worth shopping. Early deals likely won’t drop lower in price once the sale formally begins, so shopping them as soon as they’re available ensures you don’t risk missing a discount if something sells out, says Shand.

Yes, you can return Prime Day purchases . There’s no separate return policy for items you buy during the mega sale, but remember that some items can’t be returned, like groceries , downloadable software products and some jewelry.

Most items shipped and fulfilled by Amazon can be refunded within 30 days of delivery. If third-party sellers’ products are eligible for Amazon Prime, they fall under Amazon’s standard return policy. If not, they typically offer a return policy equivalent to Amazon’s.

Since Amazon has a generous return policy, it lowers the risk of shopping on Prime Day, says Steinman. So if you’re unsure about something but don’t want to miss out on the deal, know that you can easily return it.

Amazon has yet to announce if it’s hosting a second Prime Day in 2024, as it did in October 2022 and 2023. Only July’s Prime Day is guaranteed right now, so don’t wait to shop.

Meet our experts

At NBC Select, we work with experts with specialized knowledge and authority based on relevant training and/or experience. We also ensure that all expert advice and recommendations are made independently and with no undisclosed financial conflicts of interest.

• Dr. Ross Steinman is a professor of consumer psychology at Widener University . 
• Mackenzie Shand is a shopping expert at RetailMeNot , a deal-finding and cash back website.
• Vipin Porwal is the CEO and a consumer expert at Smarty .

Why trust NBC Select?

I’m an associate updates editor at NBC Select and I’ve been reporting about Amazon Prime Day for five years. I wrote NBC Select’s Prime membership guide and Amazon Prime Day history , both of which are articles I frequently update. I also write deal roundups during Amazon sale events. For this piece, I interviewed three experts about what’s worth shopping on Prime Day and how to save money during the event.

Catch up on NBC Select’s in-depth coverage of personal finance , tech and tools , wellness and more, and follow us on Facebook , Instagram , Twitter and TikTok to stay up to date.

Zoe Malin is an associate updates editor for Select on NBC News.

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Amazon.com Announces Fourth Quarter Results

SEATTLE--(BUSINESS WIRE)--Feb. 3, 2022-- Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for its fourth quarter ended December 31, 2021.

• Operating cash flow  decreased 30% to $46.3 billion for the trailing twelve months, compared with $66.1 billion for the trailing twelve months ended December 31, 2020.
• Free cash flow  decreased to an outflow of $9.1 billion for the trailing twelve months, compared with an inflow of $31.0 billion for the trailing twelve months ended December 31, 2020.
• Free cash flow less principal repayments of finance leases and financing obligations  decreased to an outflow of $20.4 billion for the trailing twelve months, compared with an inflow of $20.3 billion for the trailing twelve months ended December 31, 2020.
• Free cash flow less equipment finance leases and principal repayments of all other finance leases and financing obligations  decreased to an outflow of $14.3 billion for the trailing twelve months, compared with an inflow of $21.4 billion for the trailing twelve months ended December 31, 2020.
• Common shares outstanding plus shares underlying stock-based awards  totaled 523 million on December 31, 2021, compared with 518 million one year ago.

Fourth Quarter 2021

• Net sales  increased 9% to $137.4 billion in the fourth quarter, compared with $125.6 billion in fourth quarter 2020. Excluding the $1.3 billion unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 10% compared with fourth quarter 2020.
• Operating income  decreased to $3.5 billion in the fourth quarter, compared with $6.9 billion in fourth quarter 2020.
• Net income  increased to $14.3 billion in the fourth quarter, or $27.75 per diluted share, compared with $7.2 billion, or $14.09 per diluted share, in fourth quarter 2020. Fourth quarter 2021 net income includes a pre-tax valuation gain of $11.8 billion included in non-operating income from our common stock investment in Rivian Automotive, Inc., which completed an initial public offering in November.

Full Year 2021

• Net sales  increased 22% to $469.8 billion, compared with $386.1 billion in 2020. Excluding the $3.8 billion favorable impact from year-over-year changes in foreign exchange rates throughout the year, net sales increased 21% compared with 2020.
• Operating income  increased to $24.9 billion, compared with operating income of $22.9 billion in 2020.
• Net income  increased $33.4 billion, or $64.81 per diluted share, compared with net income of $21.3 billion, or $41.83 per diluted share, in 2020.

“A big thank you to employees across Amazon who overcame another quarter of COVID-related challenges and delivered for customers this holiday season. Given the extraordinary growth we saw in 2020 when customers predominantly stayed home, and the fact that we’ve continued to grow on top of that in 2021, our Retail teammates have effectively operated in peak mode for almost two years. It’s been a tremendous effort, and I’m appreciative and proud of how hard our teams have worked to serve customers,” said Andy Jassy, Amazon CEO. “As expected over the holidays, we saw higher costs driven by labor supply shortages and inflationary pressures, and these issues persisted into the first quarter due to Omicron. Despite these short-term challenges, we continue to feel optimistic and excited about the business as we emerge from the pandemic. When you combine how we’re staffing and scaling our fulfillment network to bring even faster delivery to more customers, the extraordinary growth of AWS with 40% year-over-year growth (and now a $71 billion revenue run rate), the addition of marquee new entertainment like  The Lord of the Rings: The Rings of Power  and  Thursday Night Football , and a plethora of new capabilities that we’re building in areas like Alexa, Ring, Grocery, Pharmacy, Amazon Care, Kuiper, and Zoox, there’s a lot to look forward to in the months and years ahead.”

Amazon also continues to invest heavily in Prime. In the last few years, Amazon has added more product selection available with fast, free, unlimited Prime shipping; more exclusive deals and discounts; and more high-quality digital entertainment, including TV, movies, music, and books. Since 2018, Prime Video has tripled the number of Amazon Originals, rolling out new series and movies like  The Boys, The Wheel of Time, Tom Clancy’s Jack Ryan, The Underground Railroad, Sound of Metal, Coming 2 America ,  The Tomorrow War,  and  Being the Ricardos .   This September, Prime Video will release the highly anticipated  The Lord of the Rings: The Rings of Power  and become the exclusive home of  Thursday Night Football  as part of a historic 11-year agreement with the National Football League (NFL). Since 2018 in the U.S., availability of Free Same-Day Delivery has expanded from 48 metropolitan areas to more than 90, items available for Prime free shipping have increased over 50%, and members have saved billions of dollars shopping Prime Day. This is all on top of new program benefits like prescription savings and fast, free delivery from Amazon Pharmacy and the continually growing Amazon Music for Prime members, Prime Reading, and Prime Gaming. With the continued expansion of Prime member benefits as well as the rise in wages and transportation costs, Amazon will increase the price of a Prime membership in the U.S., with the monthly fee going from $12.99 to $14.99, and the annual membership from $119 to $139. This is the first time Amazon has raised the price of Prime since 2018. For new Prime members, the price change will go into effect on February 18, 2022, and for current Prime members, the new price will apply after March 25, 2022, on the date of their next renewal.

• Amazon had its biggest-ever Black Friday to Cyber Monday holiday shopping weekend, with apparel, beauty, home, and toys among the top-selling categories. During the holiday season, third-party sellers—most of which are small and medium-sized businesses—achieved record worldwide sales in Amazon’s store. More than 130,000 third-party sellers worldwide surpassed $100,000 in sales on Amazon, and between Black Friday and Christmas, U.S.-based third-party sellers sold an average of 11,500 products per minute. In addition, Amazon India’s month-long Great Indian Festival sales event was the biggest shopping celebration ever for sellers and brand partners on Amazon.in, with nearly 30,000 sellers surpassing $100,000 in sales.
• Prime members are taking advantage of program benefits in record numbers. In 2021, members in the U.S. received more than 6 billion free deliveries, and over 200 million Prime members worldwide streamed shows and movies.
• Amazon Style, Amazon’s first-ever physical store for apparel, will open this year at The Americana at Brand, a top shopping destination in greater Los Angeles. Amazon Style is built around personalization and innovation. It uses machine learning algorithms to produce tailored recommendations in real time as customers shop, making it easier than ever to discover new looks. At Amazon Style, customers will be able to have items sent to a fitting room with the tap of a button in the Amazon app and continue shopping from their fitting room without having to leave.
• The first Starbucks Pickup with Amazon Go store opened in New York City. With this new store concept, customers can order a handcrafted Starbucks beverage or food item for pickup through the Starbucks app and grab food items from the Amazon Go market, all in one convenient location without having to wait in line to pay. Starbucks and Amazon Go plan to open two more stores in 2022, with the next location planned for The New York Times Building in New York City.
• UK grocer Sainsbury’s opened SmartShop Pick & Go, a Just Walk Out technology-enabled convenience store in Holborn Circus, London. The store marked the first time Amazon’s Just Walk Out technology launched in a third-party customer store internationally. It was also the first time Amazon retrofitted a third-party retail store with Just Walk Out technology, meaning the store uses Sainsbury’s existing fixtures and fittings with Amazon’s technology.
• For the second year in a row, the Retailer Preference Index—a report from research firm dunnhumby based on insights from 10,000 shoppers on 57 grocers in the U.S.—ranked Amazon as the best overall grocery retailer. Amazon was recognized for offering customers consistently low prices, convenience, and great selection on a wide variety of grocery items sold on  Amazon.com .
• Amazon partnered with Affirm to offer customers even more ways to pay on Amazon. Customers in the U.S. now have the flexibility to split the total cost of eligible purchases of $50 or more into monthly payments at checkout with no late or hidden fees.
• Amazon announced that later this year, more than 80 million Venmo users in the U.S. will have the option to pay with PayPal-owned Venmo in Amazon’s online stores using their linked bank account or Venmo balance.
• Amazon continues to invest in offering Prime members around the world same-day delivery options, including Free Same-Day Delivery, where Prime members can receive their order the same day they ordered it, and Faster Same-Day Delivery, where Prime members can receive their order in as fast as five hours. Free Same-Day Delivery is now available in more than 90 metro areas in the U.S. with the addition of Fort Collins, Colorado, and Provo, Utah; in 58 metro areas in Europe; and in Tokyo, Japan. Faster Same-Day Delivery is now available in 24 metro areas in the U.S., with new launches in the past quarter in Austin, Cincinnati, Cleveland, Denver, Indianapolis, Las Vegas, Salt Lake City, San Antonio, and San Diego.
• Amazon published its largest ever Holiday Fashion print lookbook, which was sent to millions of Prime members offering more than 1,000 items to choose from for their holiday shopping. Prime members in the U.S. who received the lookbook were able to browse a curated selection of fashion gifts and use their phone to shop items by scanning a QR code.

Entertainment

• The Wheel of Time , starring Rosamund Pike, ranked No. 1 in Nielsen’s rankings of streaming series the week of its premiere, with customers viewing more than 1 billion minutes of the series across its first three episodes. Additional Prime Video series releases included the new comedy  Harlem , the adult animated comedy  Fairfax , and the final season of the sci-fi fan favorite  The Expanse . Prime Video also announced that the first season of  Reacher , a new series based on the international best-selling book  Killing Floor  by Lee Child, will be released on February 4, and that  Diabolical,  an animated spinoff of the global hit series  The Boys,  is set to premiere in 2022.
• The critically acclaimed and highly anticipated Prime Video original film  Being the Ricardos,  starring Nicole Kidman and Javier Bardem and directed by Aaron Sorkin, premiered in theaters and on Prime Video;  The Tender Bar , starring Ben Affleck and directed by George Clooney, premiered in theaters and on Prime Video; and the fourth and final installment of the family-favorite franchise  Hotel Transylvania: Transformania , featuring the vocal talents of Selena Gomez and Andy Samberg, premiered on Prime Video.
• Prime Video continues to garner significant awards recognition for its original series and movies.  Being the Ricardos  was nominated for two Screen Actors Guild (SAG) Awards (female actor in a leading role Nicole Kidman and male actor in a leading role Javier Bardem) and three Critics Choice Awards (lead actress Nicole Kidman, supporting actor J.K. Simmons, and original screenplay Aaron Sorkin).  The Tender Bar  was nominated for a SAG Award (male actor in a supporting role Ben Affleck).  A Hero,  the foreign language feature from Iranian director Asghar Farhadi, was nominated for a Critics Choice Award (foreign language film) and shortlisted for the Academy Awards (international feature).  The Underground Railroad,  which earned seven Emmy nominations in 2021, was nominated for three Critics Choice Awards (limited series, lead actress Thuso Mbedu, and supporting actor William Jackson Harper) and two Independent Spirit Awards (new scripted series and female performer Thuso Mbedu).
• The fourth quarter marked Prime Video’s strongest viewership for live sports globally. The 2021-2022  Thursday Night Football  season streaming on Prime Video and Twitch delivered the highest average minute audience, a measurement of the average number of devices streaming  Thursday Night Football  at any given minute during the live game, since Amazon acquired shared rights in 2017. In the UK, the Manchester United vs. Arsenal soccer game on December 2, 2021, became the most-watched Premier League match ever on the service, with an estimated viewership of more than 4 million. Plus, millions of rugby fans tuned in to the Autumn Nations Series, the first full competitive international rugby union series featuring the top Northern and Southern Hemisphere teams since 2019. In India, Prime Video made its first foray into live sports, streaming cricket matches between New Zealand and Bangladesh.
• Prime Video debuted 28 local originals internationally, including  Maradona: Blessed Dream  (Argentina),  Burning  (Australia),  Inside Edge Season 3  (India), and  The Ferragnez - The Series  (Italy). New locally produced series and movies launched in Argentina, Australia, Brazil, France, Germany, India, Italy, Japan, Mexico, Spain, and the UK.
• IMDb TV launched  Judy Justice , starring the Honorable Judy Sheindlin, a retired judge of the Manhattan Family Court and a TV judge for over 25 years. The series marked Amazon Studios’ largest-ever episode order for an original series with 120 episodes, and it is the first series to offer audiences a daily release cadence.
• Amazon Music presented music icon Ye’s first headlining concert in five years, with special guest Drake, exclusively on the Amazon Music Twitch Channel, Prime Video, and the Amazon Music app. During the show, customers in the U.S. could preorder a range of limited-edition merchandise created by Ye and fashion designer Demna exclusively in the Amazon Fashion store and in the Amazon Music app.
• The  Blippi’s Treehouse  series debuted exclusively on Amazon Kids+ in Canada, the UK, and the U.S., bringing one of the world’s most popular kid’s characters to Amazon’s kids and family subscription service.

Devices and Services

• Amazon and Stellantis announced a series of global, multi-year agreements that will introduce new connected experiences across a portfolio of 14 iconic brands, including Chrysler, Dodge, Fiat, Jeep, and Peugeot. As part of the collaboration, Amazon will deliver software for Stellantis’ new digital cabin platform, STLA SmartCockpit, in millions of vehicles over the next decade.
• Amazon announced it has now sold more than 150 million Fire TV devices worldwide since launching the device in 2014. Amazon introduced a new in-vehicle experience for passengers to use Alexa or on-screen touch controls to access more than 1 million TV episodes and movies on Fire TV in the U.S. Fire TV will also be built into BMW’s new 31-inch Theatre Screen for rear-seat passengers.
• Amazon announced a collaboration with Lockheed Martin and Cisco that will send Alexa into space as a part of Artemis I, the first of several NASA missions that will land the first woman and the first person of color on the Moon. Alexa will join the upcoming mission as a part of Callisto, a technology-demonstration payload embedded into NASA’s Orion spacecraft.
• Amazon launched new features to make Alexa more proactive, conversational, and personal. Customers can now teach Alexa their preferences, such as for food and sports, that Alexa will remember when recommending recipes, local restaurants, and sports scores. Alexa can also start a Routine after detecting activities. For example, if Alexa detects a beeping washing machine or the sound of running water, Alexa can alert customers that the laundry is done or to turn off the faucet. Customers using the Echo Show 10 can also enable Conversation Mode for a more natural, back-and-forth interaction with Alexa without needing to repeat the Alexa wake word.
• Amazon launched the Amazon Smart Air Quality Monitor in Canada, France, Italy, Spain, the UK, and the U.S. This new air quality monitor measures the presence of indoor allergens and toxins and makes it simple for customers to check the air quality of their home.
• Ring launched and started shipping the Ring Alarm Glass Break Sensor, which uses artificial intelligence technology to monitor glass windows or doors and alert customers if their glass is broken.
• Amazon announced Amazon Sidewalk Bridge Pro by Ring, which will bring professional-grade device connectivity to even more places, including commercial centers, parks, universities, and wilderness areas. Alongside the announcement, Amazon launched two pilot programs. The first pilot, with Arizona State University, will focus on extending the range of connectivity for the university’s on-campus internet of things devices, including sunlight sensors, temperature sensors, CO2 detectors, and particle counters. The second pilot is with Thingy, a technology company that provides information to first responders about wildfires. Thingy will work with Sidewalk Bridge Pro to provide connectivity for Thingy’s air quality monitoring systems and share information to help combat wildfires.
• Amazon launched Ultrasound Motion Detection for customers to enable Occupancy Routines when motion is detected (or not detected) near their Echo device. With Ultrasound Motion Detection, the device can emit an inaudible ultrasound wave to detect movement and initiate a Routine. For example, with an Occupancy Routine, Alexa can turn off the lights when a person leaves the room or automatically play music when motion is detected near an Echo device.

Amazon Web Services

• In a landmark announcement for the financial services industry,  Nasdaq  shared its multi-year partnership to migrate its markets to AWS with the goal of becoming the world's first fully enabled, cloud-based exchange. The move includes migrating Nasdaq’s matching engine, the core technology that makes the market tick.
• Technology:  Meta , the parent company of Facebook, Instagram, WhatsApp, and other companies,   selected AWS as its long-term strategic cloud provider to accelerate artificial intelligence research and development.  Qualtrics  expanded its relationship with AWS to migrate internal IT systems and customer-facing workloads to the cloud.
• Automotive:  Stellantis  selected AWS as its preferred cloud provider for vehicle platforms to accelerate new digital products and upskill its global workforce.  Rivian  selected AWS as its preferred cloud provider for its capabilities in analytics, compute, containers, and machine learning to accelerate the shift to electric vehicles and make transportation cleaner and more sustainable.  Aurora  selected AWS as its preferred cloud provider for machine learning training and cloud-based simulation workloads to safely accelerate the development of self-driving vehicle technology.
• Retail:  Best Buy  selected AWS as its preferred cloud provider and will migrate enterprise systems and business-critical workloads to the cloud to modernize its technology platforms and become a destination for top engineering talent.  Under Armour  selected AWS as its preferred cloud provider for SAP to increase resilience, enhance security, and provide more significant business insights.  adidas  migrated its SAP environments to AWS to digitize core business processes across its value chain and support new business models such as direct-to-consumer.  Richemont  is moving its enterprise IT infrastructure to AWS, including its data centers in Europe, Hong Kong, and the U.S.
• Financial services:  Goldman Sachs  and AWS launched a suite of cloud-based data and analytics solutions for financial institutions, which will reduce the need for investment firms to develop and maintain foundational data-integration technology, lower the barriers to entry for accessing advanced quantitative analytics across global markets, and streamline access to financial data from Goldman Sachs.  AIG  tapped AWS as its preferred public cloud provider to accelerate a large-scale digital transformation.  Fannie Mae  is using AWS to automate processes, enhance IT security, and innovate new services that facilitate equitable and sustainable access to homeownership and affordable rental housing.
• Health care and life sciences:  Pfizer  is working with AWS to improve how new medicines are developed, manufactured, and distributed for testing in clinical trials.  Roche  is using AWS technology to facilitate secure research collaboration, deliver new diagnostic technologies, and unlock insights from health data to deliver high-quality, individually tailored patient care.  Gilead  will use AWS machine learning and analytics to inform clinical trial design and advance data-driven decision making to help refine its drug pipeline.
• Agriculture:  Bayer Crop Science , in collaboration with Bushel and AWS, launched a carbon footprint measurement solution to help farmers in the U.S. drive more sustainable supply chains and mitigate the impact of agriculture on the environment.
• Manufacturing:  Siemens Digital Industries Software  expanded its collaboration with AWS to drive adoption of Siemens’ Xcelerator as a Service and help industrial companies accelerate digital transformation in the cloud.  Kone  selected AWS to provide global cloud capabilities to help innovate and scale its connected solutions and services for smart buildings.
• Media and entertainment:  Discovery  extended its strategic relationship with AWS to provide discovery+ viewers with enhanced, reliable, and personalized viewing experiences.
• Travel and hospitality:  United Airlines  selected AWS as its preferred cloud provider to deliver personalized and scalable services for its customers and employees, as well as optimize airport operations.
• AWS Private 5G, a managed service that helps enterprises set up and scale private 5G mobile networks in days instead of months.
• AWS Mainframe Modernization, which makes it faster and easier for customers to migrate mainframe and legacy workloads to the cloud and enjoy the superior agility, elasticity, and cost savings of AWS.
• Since their introduction in 2020, Graviton2 processors have been rolled out across general purpose, burstable, compute optimized, storage optimized, and memory optimized instances—providing customers up to 40% better price performance over comparable generation x86-based instances. Today, 48 of the top 50 Amazon EC2 customers use Graviton2 instances to deliver superior price performance to their customers. At re:Invent 2021, AWS announced new compute optimized instances featuring Graviton3 processors that will provide an additional 25% better performance over comparable Graviton2-based instances.
• A total of three new instance types powered by AWS-designed chips, including compute optimized instances featuring Graviton3 processors that provide up to 25% better performance over comparable Graviton2 instances, new instances powered by AWS Trainium chips that provide the best price performance and the fastest time to train most machine learning models in Amazon EC2, and storage optimized instances that feature new AWS Nitro SSDs for the best storage performance for I/O-intensive workloads.
• Six new capabilities for Amazon SageMaker, AWS’s industry-leading machine learning service, that make it even easier to prepare and gather data for machine learning, train models faster, optimize the type and amount of compute needed for inference, and expand machine learning to an even broader audience.
• AWS Cloud WAN, a managed wide area network service that makes it faster and easier for enterprises to build, manage, and monitor a unified global network that seamlessly connects cloud and on-premises environments.
• AWS IoT TwinMaker, which makes it faster and easier for developers to create digital twins of real-world systems like buildings, factories, industrial equipment, and production lines.
• AWS IoT FleetWise, which makes it easier and more cost-effective for automakers to collect, transform, and transfer vehicle data to the cloud in near-real time.
• New serverless options for Amazon Redshift, Amazon Managed Streaming for Apache Kafka, and Amazon EMR that make it easier to analyze data at any scale without having to configure, scale, or manage the underlying infrastructure.
• AWS Amplify Studio, a visual development environment that allows developers to create web application user interfaces with minimal coding.
• Four new storage services and capabilities for Amazon S3 Glacier, Amazon FSx, Amazon EBS Snapshots, and AWS Backup that deliver more choice, reduce costs, and help customers better protect their data.
• New capabilities for Amazon Relational Database Services, Amazon DynamoDB, and Amazon DevOps Guru that make it easier and more cost efficient for customers to customize their database environment, run the right databases for their job, and use machine learning to better detect and diagnose database-related performance issues.
• AWS announced the general availability of Babelfish for Amazon Aurora PostgreSQL-Compatible Edition, a new capability that allows customers to run applications written for Microsoft SQL Server directly in Amazon Aurora with little to no code changes.
• AWS announced the general availability of Amazon EC2 Hpc6a instances, a new instance type that is purpose-built for high-performance computing workloads, like genomics, computational fluid dynamics, weather forecasting, molecular dynamics, computational chemistry, financial risk modeling, computer-aided engineering, and seismic imaging.
• AWS continued to expand its infrastructure footprint around the world, opening the AWS Asia Pacific (Jakarta) Region and announcing plans to launch the AWS Canada West (Calgary) Region in late 2023 or early 2024. Newly released AWS economic impact studies estimate that the AWS Asia Pacific (Jakarta) Region will create 24,700 direct and indirect jobs through a planned investment of $5 billion (IDR$71 trillion) in Indonesia over the next 15 years, and AWS will invest over $17 billion (CA$21 billion) in Canada by 2037 on the construction and operation of its two Canadian infrastructure Regions. Globally, AWS has 84 Availability Zones across 26 geographic Regions, with announced plans to launch 24 more Availability Zones and eight more AWS Regions.

Investing in Employees and Our Workplace

• Amazon now employs more than 1.6 million people worldwide and continues to invest in offering industry-leading pay and benefits. This includes an average starting wage for front-line employees of more than $18 per hour in the U.S. and comprehensive benefits for full-time employees. These benefits include health, vision, and dental insurance; a 401(k) with 50% company match; up to 20 weeks paid parental leave; and Amazon’s Career Choice program, through which the company fully funds the cost of an employee’s college tuition, including classes, books, and fees. Amazon also expanded its incentives for front-line employees to get vaccinated against COVID-19 to include $40 for boosters. Each front-line employee is eligible to receive up to $120 ($40 per dose), and new hires who join the company fully vaccinated are given a $100 new-hire bonus.
• Amazon launched Make Every Day Better for Employees, a new mechanism to help keep employees up to date on changes the company is making based on employee feedback. The first employee-prompted updates rolled out by the company included enhanced mental health and well-being resources, workplace technology improvements, and support for immigration needs.
• Amazon is helping bring more parents back to the workforce through the company’s new FamilyFlex program. The program provides greater flexibility and benefits to eligible hourly employees in the U.S., including scheduling options, child care resources, and Anytime Pay for employees looking to access their earnings without waiting for payday.
• Amazon launched a new tool, Project Juno, to help military spouses continue their careers at Amazon when their partners need to move on military orders. Created by military spouses for military spouses, Project Juno helps a member of Amazon’s team find the same job or a similar role near their new home within 48 hours.

Supporting Local Communities and the Economy

• The Amazon Housing Equity Fund, the company’s $2 billion commitment to creating and preserving affordable homes, launched a $21 million pilot program to accelerate opportunities for real estate developers of color. The program is open to developers focused on affordable housing initiatives in the Puget Sound region of Washington state; the Arlington, Virginia region; and Nashville, Tennessee. The program includes professional education, training, mentorship, and grant funding to help cover upfront real estate development costs. Separately, the Amazon Housing Equity Fund also committed $160 million in low-rate loans to help preserve more than 1,300 affordable homes for 99 years in Arlington.
• To further underscore Amazon’s ongoing commitment to gender equity, Amazon signed the United Nation’s Women’s Empowerment Principles (WEPs). The WEPs, established by the United Nations Global Compact and UN Women, help businesses collectively promote gender equity and empower women in the workplace and global community.
• Amazon announced a $1 million contribution to the Resilience Fund for Women in Global Value Chains. Founded in 2020, the fund aims to tackle systemic challenges underlying the profound and pressing needs of women during the COVID-19 pandemic with local, women-led solutions.
• Amazon donated more than 300,000 emergency aid items, including clothing, food, generators, medical supplies, shelter equipment, and water, to support communities affected by tornadoes in the Midwest and Southern U.S.; wildfires in Colorado; and flooding in Chennai and Uttarakhand, India, and in British Columbia, Canada.
• Amazon announced it has now delivered more than 20 million meals to vulnerable families disproportionately impacted by COVID-19 in more than 25 U.S. cities and communities in Australia, Japan, Singapore, Spain, and the UK. Since March 2020, Amazon has volunteered its delivery network to support food banks and community organizations by delivering groceries and pre-packaged meals to hard-hit areas.
• In France, Amazon invested over €11 billion between 2010 and 2020. Since launching Amazon.fr in 2000, over 14,500 permanent jobs have been created, and there are over 13,000 small and medium-sized businesses selling on Amazon in France, resulting in more than 25,000 indirect jobs to run the online businesses.
• In Italy, Amazon has invested €8.7 billion between 2010 and 2020. Since launching Amazon.it in 2010, over 12,500 permanent jobs have been created, and there are over 18,000 small and medium-sized businesses selling on Amazon in Italy, resulting in more than 50,000 indirect jobs to run the online businesses.
• In Spain, Amazon invested over €6.8 billion between 2010 and 2020. Since launching Amazon.es in 2011, over 15,000 permanent jobs have been created, and there are over 12,000 small and medium-sized businesses selling on Amazon in Spain, resulting in more than 30,000 indirect jobs to run the online businesses.
• In the UK, Amazon has invested £32 billion between 2010 and 2020. Since launching Amazon.co.uk in 1998, over 70,000 permanent jobs have been created, and there are over 65,000 small and medium-sized businesses selling on Amazon in the UK, resulting in more than 175,000 indirect jobs to run the online businesses.
• Amazon expanded access to free cloud skills training as part of AWS’s mission to educate 29 million people by 2025. These learning programs and experiences include the launch of AWS Skill Builder, a new digital learning experience; the addition of AWS courses to the  Amazon.com  website; the expansion of the AWS re/Start global reskilling program; and the opening of the AWS Skills Center in Seattle, Amazon’s first dedicated, in-person cloud learning space.
• Amazon announced new initiatives to make machine learning more accessible for anyone interested in learning and experimenting with the technology. The AWS Artificial Intelligence & Machine Learning Scholarship is a $10 million education and scholarship program aimed at preparing underrepresented and underserved students globally for careers in machine learning. Amazon SageMaker Studio Lab makes it easy to quickly set up a machine learning development environment for learning and experimentation at no cost.

Protecting the Planet

• Amazon welcomed 16 new companies to The Climate Pledge, including Snap Inc. and Fortescue Metals Group, bringing the total number of companies that have pledged to achieve net-zero carbon emissions by 2040 to 217. Pledge signatories generated over $1.9 trillion in global annual revenue in 2020 and have over 7 million employees across 29 industries in 24 countries.
• Mobilizing $1 billion to protect tropical forests via the LEAF (Lowering Emissions by Accelerating Forest finance) Coalition, an ambitious public-private initiative designed to protect tropical forests and support sustainable development.
• Joining the First Movers Coalition, a partnership between the World Economic Forum and the U.S. Office of the Special Presidential Envoy for Climate John Kerry to promote buying low-carbon products.
• Participating in the Corporate Clean Energy Demand Initiative to promote countries and companies working together to advance shared clean energy goals by leveraging corporate clean energy commitments.
• Joining the Sustainable Aviation Buyers Alliance and helping to found the Aviators Group to accelerate the transition to net-zero emissions air transport.
• Amazon received the Terra Carta Seal Award from His Royal Highness Prince Charles in recognition of the company’s climate leadership. The Terra Carta Seal is awarded to companies that hold a leadership position within their industry and that have credible transition roadmaps underpinned by globally recognized, scientific metrics for achieving net-zero carbon emissions by 2050 or earlier.
• Amazon announced 18 new utility-scale wind and solar energy projects in Finland, Germany, Italy, Spain, the UK, and the U.S., representing 2 gigawatts of new clean energy capacity and increasing Amazon’s renewable energy procurement by 40% in one year. With 274 renewable energy projects, Amazon continues to be the largest corporate buyer of renewable energy globally and is on a path to power 100% of its business operations with renewable energy by 2025—five years ahead of its 2030 target.

Financial Guidance

The following forward-looking statements reflect Amazon.com’s expectations as of February 3, 2022, and are subject to substantial uncertainty. Our results are inherently unpredictable and may be materially affected by many factors, such as uncertainty regarding the impacts of the COVID-19 pandemic, fluctuations in foreign exchange rates, changes in global economic conditions and customer demand and spending, inflation, labor market and global supply chain constraints, world events, the rate of growth of the Internet, online commerce, and cloud services, and the various factors detailed below. This guidance reflects our estimates as of February 3, 2022 regarding the impacts of the COVID-19 pandemic on our operations as well as the effect of other factors discussed above.

First Quarter 2022 Guidance

• Net sales are expected to be between $112.0 billion and $117.0 billion, or to grow between 3% and 8% compared with first quarter 2021. This guidance anticipates an unfavorable impact of approximately 150 basis points from foreign exchange rates.
• Operating income is expected to be between $3.0 billion and $6.0 billion, compared with $8.9 billion in first quarter 2021. This guidance includes approximately $1.0 billion lower depreciation expense due to increases in the estimated useful lives of our servers and networking equipment beginning on January 1, 2022.
• This guidance assumes, among other things, that no additional business acquisitions, restructurings, or legal settlements are concluded.

A conference call will be webcast live today at 2:30 p.m. PT/5:30 p.m. ET, and will be available for at least three months at  amazon.com/ir . This call will contain forward-looking statements and other material information regarding the Company’s financial and operating results.

These forward-looking statements are inherently difficult to predict. Actual results and outcomes could differ materially for a variety of reasons, including, in addition to the factors discussed above, the amount that  Amazon.com  invests in new business opportunities and the timing of those investments, the mix of products and services sold to customers, the mix of net sales derived from products as compared with services, the extent to which we owe income or other taxes, competition, management of growth, potential fluctuations in operating results, international growth and expansion, the outcomes of claims, litigation, government investigations, and other proceedings, fulfillment, sortation, delivery, and data center optimization, risks of inventory management, variability in demand, the degree to which the Company enters into, maintains, and develops commercial agreements, proposed and completed acquisitions and strategic transactions, payments risks, and risks of fulfillment throughput and productivity. Other risks and uncertainties include, among others, risks related to new products, services, and technologies, system interruptions, government regulation and taxation, and fraud. In addition, the global economic climate and additional or unforeseen effects from the COVID-19 pandemic amplify many of these risks. More information about factors that potentially could affect Amazon.com’s financial results is included in Amazon.com’s filings with the Securities and Exchange Commission (“SEC”), including its most recent Annual Report on Form 10-K and subsequent filings.

Our investor relations website is  amazon.com/ir  and we encourage investors to use it as a way of easily finding information about us. We promptly make available on this website, free of charge, the reports that we file or furnish with the SEC, corporate governance information (including our Code of Business Conduct and Ethics), and select press releases, which may contain material information about us, and you may subscribe to be notified of new information posted to this site.

About Amazon

Amazon is guided by four principles: customer obsession rather than competitor focus, passion for invention, commitment to operational excellence, and long-term thinking. Amazon strives to be Earth’s Most Customer-Centric Company, Earth’s Best Employer, and Earth’s Safest Place to Work. Customer reviews, 1-Click shopping, personalized recommendations, Prime, Fulfillment by Amazon, AWS, Kindle Direct Publishing, Kindle, Career Choice, Fire tablets, Fire TV, Amazon Echo, Alexa, Just Walk Out technology, Amazon Studios, and The Climate Pledge are some of the things pioneered by Amazon. For more information, visit  amazon.com/about  and follow @AmazonNews.