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Although the coronavirus pandemic is costing Amazon billions of dollars, it's also saved the company millions in travel and marketing.
During Amazon's third-quarter earnings call on Thursday, chief financial officer Brian Olsavsky laid out how the company's spending has changed during the pandemic — including a major reduction in internal travel expenses.
"We've saved nearly $1 billion in travel this year because travel's ground to a halt," Olsavsky said.
He said he expects travel to resume "at a later date," but that Amazon may not spend at "the same levels as the past."
Beyond corporate travel, Amazon has also saved on marketing in 2020. Olsavsky said that the company spent less on marketing than usual in the second quarter, although that spending began to return to normal levels in the third quarter. He said he expects marketing spending to continue in the fourth quarter as well.
"But certainly there was not a lot of need to do marketing this year for parts of the year," Olsavsky said.
While these reductions have saved Amazon at least $1 billion this year, they don't offset the costs Amazon has incurred as a result of the pandemic. Amazon says it has recorded $7.5 billion this year in costs related to the coronavirus, and expects to spend an additional $4 billion in the fourth quarter alone.
Though part of those costs are related to spending on cleaning and supplies at Amazon's fulfillment centers or testing for employees, Olsavsky said most of it is around productivity.
"There's productivity drags for things like new hire ramps, social distancing, extended break periods — things that we can quantify and say, this is a change in our process that has hurt productivity," Olsavsky said.
Amazon has also expanded rapidly in order to keep up with a surge in shopping demand during the pandemic. Last week, the company announced it was hiring 100,000 additional seasonal workers to help during the holiday shopping season, Amazon's fifth major hiring push in 2020 alone. The latest announcement brings Amazon's total hiring to over 400,000 since the beginning of the pandemic.
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