Amazon said its shoppers keep choosing cheap items – and that's good for business

• Amazon's customers are buying inexpensive products, nan retailer's apical execs said successful its Thursday net call.
• Those products are being purchased often and successful larger amounts, nan execs added.
• Amazon reported a beardown 3rd quarter, beating Q3 net expectations.

Amazon's customers are buying its cheaper products, but astatine a higher volume, nan institution said, announcing a affirmative slate of third-quarter earnings.

"At a clip erstwhile consumers are being observant astir really overmuch they spend, we're continuing to little prices and vessel moreover much quickly, and we tin spot this resonating pinch customers arsenic our portion maturation continues to beryllium beardown and outpace moreover our gross growth," Andy Jassy, Amazon's CEO, said successful an earnings call connected Thursday.

And customers are progressively utilizing nan level to bargain cheaper mundane family items, for illustration "health, beauty, and individual attraction arsenic good arsenic nonperishable grocery," Brian Olsavsky, Amazon's finance chief, said successful nan call.

While these items "often person a little mean trading price," Olsavsky said that these buying patterns are still a nett affirmative for Amazon.

"We spot that erstwhile customers acquisition these types of items from us, they build bigger baskets, shop much often and walk much connected Amazon," Olsavsky said.

Amazon's besides dealing pinch a customer guidelines that's "looking for deals" and "price conscious," Jassy said.

He said that this user behaviour "matches up well" pinch Amazon's Prime rank and income events.

Paid Prime memberships person gone up this quarter, Jassy added, which has been "hugely impactful" for Amazon.

Amazon's cost-conscious customer base

Amid nan precocious costs of homeownership, childcare, and retirement, US consumers person been saving more and cutting back connected everything from nutrient and recreation to home improvement.

Wells Fargo carried retired a survey from September 5 to October 3, 2023, of much than 3,500 US adults and teenagers. Around 67% of respondents said they had slashed their spending owed to nan economy. And 62% of nan survey's respondents said they had small near for "extras" aft paying their monthly bills.

Representatives for Amazon did not respond to a petition for remark from Business Insider, sent extracurricular business hours.

Amazon reported strong third-quarter earnings connected Thursday. Its nett income for nan 4th deed $158.9 billion, outperforming nan statement expert estimate of $157.3 billion.

Its income successful North America accrued 9% twelvemonth complete twelvemonth to $95.5 billion, while its income internationally accrued 12% twelvemonth complete twelvemonth to $35.9 billion.

Its nett income accrued to $15.3 cardinal — aliases $1.43 per diluted stock — successful Q3, compared pinch $9.9 billion, aliases $0.94 per diluted share, successful nan aforesaid play past year.

Shortly aft nan results, the company's stock climbed much than 6% successful volatile after-hours trading. Despite a 3.3% driblet during regular trading connected Thursday, nan banal is still up astir 23% truthful acold successful 2024.