Whole Foods now makes less money, but Amazon doesn't care

Whole Foods is making much less money since Amazon bought it and slashed prices across the board, but the online shopping giant doesn't really care.

Amazon revealed in an earnings call on Thursday that the supermarket chain made around two thirds less profit in the month since the acquisition than the same period last year (part of the difference can be attributed to accounting considerations). 

That didn't stop Amazon from reporting a killer quarter overall, sending its stock soaring in after-hours trading.

Whole Foods' $1.3 billion contribution to Amazon's revenue is a relative blip in its record $44 billion total haul this quarter. 

7 shock-worthy facts about Amazon:

8 PHOTOS
7 shock-worthy facts about Amazon
See Gallery
7 shock-worthy facts about Amazon
7.5 percent of Seattle's working-age population are Amazon employees

Amazon has more than 300,000 employees worldwide, and 40,000 in Seattle alone.

As a portion of the city's working-age population — roughly 528,000 — that comes out to 7.5% of the city working at Amazon.

For perspective, if the same portion of New York City's adults worked for one company, that company would have about 488,000 locals on staff.

Amazon accounts for 43% of all online sales

Amazon used to be a way to buy books online; today, it's the default buying site for just about everything, especially for people who have Amazon Prime.

An analysis by Slice Intelligence released in February found that 43% of all US online retail sales were done through Amazon in 2016.

That's up from 33% in 2015 and 25% in 2012.

1 out of every 4 US adults has Amazon Prime.

Speaking of Amazon Prime, the company now counts approximately 63 million people among its subscriber base, or about 25% of the total US adult population.

That number may underestimate the true coverage, however, since it doesn't account for multiple adults in one household all sharing the same Prime account.

Amazon ships 1.6 million packages a day

Amazon fulfillment is a beast of its own.

A report from 2013 (the latest year for which data are available) found Amazon shipped 608 million packages that year, or 1.6 million packages a day.

As of 2015, Amazon estimated its fulfillment centers were within 20 miles of 31% of the US population, and within 20 miles of 50-65% of its core, same-day-accessible market.

That's enough cardboard to span all of West Virginia

A back-of-the-envelope calculation reveals all those packages (not including padded envelopes) yield roughly 26,400 square miles of cardboard.

The total land area of West Virginia, meanwhile, is just north of 24,000 square miles.

Given the speed of Amazon's shipments, the company could blanket the whole US in cardboard in about five months.

45,000 robots roam the floors of Amazon's warehouses

To help those shipments leave the warehouses on time, Amazon relies on a growing fleet of autonomous robots that fetch packages from their shelves and bring them to human employees.

The 45,000 robots live across 20 fulfillment centers in the US. In 2016, the company increased the fleet 50% from its prior head count of 30,000.

Amazon is more valuable than all major brick-and-mortar retailers combined

The sum total of those investments in infrastructure and supply chain management have made Amazon by far the most valuable retailer in the United States.

Amazon's $356 billion valuation is so big, it's larger than Wal-Mart, Target, Best Buy, Macy's, Kohl's, JCPenney, and Sears combined.

With the recent acquisition of Whole Foods, there are no signs the retailer has any plans of slowing down.

HIDE CAPTION
SHOW CAPTION
of
SEE ALL
BACK TO SLIDE

But the value of Whole Foods to Amazon has always been about much more than its grocery sales. To Amazon, Whole Foods is a network of distribution centers, a marketing floor for its gadgets, a promotional tool to boost Prime membership, and a stable of established private-label brand names to add to its burgeoning collection.

Amazon execs hinted at some of the company's big plans for the chain in the earnings call.

"There will be a lot of work together between Prime Now, Amazon Fresh, Whole Foods, Whole Foods products on the Amazon site, and Amazon lockers at the Whole Foods stores," Amazon chief financial officer Brian Olsavsky told investors and analysts. "There will be a lot of integration, a lot of touch points, and a lot of working together as we go forward."

STOCK PRICE FOR AMZN

Full price information

Amazon is famous for its long-term thinking, often at the expense of turning an immediate profit, so its approach here is not out of character. The company's various ventures now encompass almost every single consumer market, and CEO Jeff Bezos is an expert at linking these sometimes disparate threads in such a way that they build on one another toward a longer term goal.

Thursday's report marks Amazon's 10th straight profitable quarter and its biggest sales to date, a fact that went mostly unmentioned in its presentation.

Amazon's money-minting cloud business continues to cushion profits, despite slowing growth. Its expansion efforts overseas are paying off in the form of big retail growth. Its advertising operation, a relative afterthought in the context of its entire balance sheet, grew sales by an estimated 58 percent to around five times Snapchat's entire revenue.

Despite constant doubts from high-profile investors about the longevity of Amazon's reign, the company remains pretty much unstoppable. 

And that's why it can afford to sell you cheap avocados.

RELATED: The most popular grocery store in every state

52 PHOTOS
The most popular grocery store in every state
See Gallery
The most popular grocery store in every state

ALABAMA: Publix 

Photo credit: Getty

ALASKA: Safeway 

Photo credit: Reuters 

ARIZONA: FrysFoodStores 

Photo credit: Getty

ARKANSAS: Harps Food Stores

Photo credit: Getty

CALIFORNIA: Trader Joe's

Photo credit: Getty

COLORADO: King Soopers

Photo credit: Getty

CONNECTICUT: Whole Foods Market 

Photo credit: Reuters 

DELAWARE: Food Lion Grocery Store 

Photo credit: Getty

WASHINGTON, D.C.: Whole Foods Market

Photo credit: Getty

FLORIDA: Publix 

Photo credit: Getty

GEORGIA: Publix 

Photo credit: Getty

HAWAII: Safeway 

Photo credit: Getty

IDAHO: Albertsons

Photo credit: Getty

ILLINOIS: Jewel 

Photo credit: Getty

INDIANA: Kroger 

Photo credit: Getty

IOWA: Hy-Vee 

Photo credit: Getty 

KANSAS: Hy-Vee

Photo credit: Getty

KENTUCKY: Kroger 

Photo credit: Getty

LOUISIANA: Rouses Markets 

Photo credit: Getty

MAINE: Shaw's 

Photo credit: Getty

MARYLAND: Safeway 

Photo credit: Getty

MASSACHUSETTS: Whole Foods Market 

Photo credit: Reuters 

MICHIGAN: Kroger 

Photo credit: Getty

MINNESOTA: Cub Foods 

Photo credit: Reuters 

MISSISSIPPI: Kroger 

Photo credit: Getty 

MISSOURI: Hy-Vee 

Photo credit: Getty

MONTANA: Albertsons

Photo credit: Getty

NEBRASKA: Hy-Vee

Photo credit: Getty

NEVADA: Albertsons

Photo credit: Getty

NEW HAMPSHIRE: Shaw's 

Photo credit: Getty

NEW HAMPSHIRE: Shaw's 

Photo credit: Getty

NEW MEXICO: Albertsons

Photo credit: Getty

NEW YORK: Whole Foods Market

Photo credit: Getty

NORTH CAROLINA: Food Lion Grocery Store

Photo credit: Getty

NORTH DAKOTA: Hombacher's

Photo credit: AOL

OHIO: Kroger 

Photo credit: Getty 

OKLAHOMA: Homeland Stores

Photo credit: Getty

OREGON: Safeway 

Photo credit: Getty

PENNSYLVANIA: Wegmans Food Markets

Photo credit: Getty

RHODE ISLAND: Shaw's

Photo credit: Shutterstock

SOUTH CAROLINA

Photo credit: Getty

SOUTH DAKOTA: Hy-Vee 

Photo credit: Getty

TENNESSEE: Publix

Photo credit: Getty

TEXAS: H-E-B 

Photo credit: Getty

UTAH: Smith's

Photo credit: Getty

VERMONT: Shaw's 

Photo credit: Getty

VIRGINIA: Food Lion Grocery Store 

Photo credit: Getty

WASHINGTON: Safeway

Photo credit: Reuters 

WEST VIRGINIA: Food Lion Grocery Store

Photo credit: Getty

WISCONSIN: Pick 'n Save 

Photo credit: Getty

WYOMING: Albertsons

Photo credit: Getty

HIDE CAPTION
SHOW CAPTION
of
SEE ALL
BACK TO SLIDE

 

Read Full Story

Can't get enough business news?

Sign up for Finance Report by AOL and get everything from retailer news to the latest IPOs delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.