Tuesday, 21 August, 2018

Amazon hikes cost of Prime membership

Textile Museum DC Amazon delivers huge profit surprise, stock surges
Kelvin Reese | 27 April, 2018, 11:22

If you're an existing Amazon Prime subscriber, are you thinking about canceling your subscription because of the price increase? Starting May 11, a Prime membership will cost $119, which is $20 increase from the current $99. For the first time, Amazon's founder and CEO Jeff Bezos recently disclosed the company had more than 100 million Prime subscribers, globally.

Amazon shares have risen in after-hours trading after it reported a better-than-expected 43% rise in first quarter sales to $51bn. Today's increase to the annual Prime membership makes the pricing a little closer to the monthly cost, but customers are still saving substantially by subscribing to the annual membership rather than monthly.

The fee was increased to help Amazon cover rising shipping costs and to pay for video-streaming content and technology investments, said RJ Hottovy, an equity analyst at Morningstar Inc. Analysts estimated operating income of $1.13 billion of operating income and sales of $52.3 billion.

Amazon Web Services (AWS), which handles data and computing for large enterprises in the cloud, saw its profit margin expand in the quarter.

Annual Prime members can expect to receive an email with their renewal details sometime next month, according to Amazon.

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Amazon's losses from its worldwide business continue to rise largely due to its growing India investments.

North America net sales grew 46% to $30.73 billion, and operating income almost doubled to $1.15 million.

Take a deep breath: Amazon Prime is about to get more expensive.

"The value of Prime to customers has never been greater". This guidance anticipates a favorable impact of approximately $1.2 billion or 320 basis points from foreign exchange rates.

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