The drive for Amazon to sell quickly is hurting its revenues. The online retailer said their net income for the third quarter crumbled 26 percent from a year earlier, meeting predictions from Wall Street.
Amazon also disappointed analysts with its sales outlook for the holiday shopping season with the stock plunging 7 percent in extended sessions.
Instead of two, Amazon decides to slash the delivery time in half to one day. To do this, the company hires additional staff to its factories and extends the distribution network with more vans, jets and storage facilities for parcels.
The project costs the organization about $1.5 billion, nearly double what it said it would cost earlier. Yet Amazon said the one-day delivery draws more buyers and brings more money from consumers.
According to Amazon chief executive officer Jeff Bezos, this huge investment is "the best long-term choice." The Seattle-based company posted a net income of $2.1 billion.
With impressive sales coming from its ventures in the Cloud business, the company's profits improved to 36 percent, a key turnaround when it could only muster half of this figure last year.
In the past 24 months, Amazon's measly sales have slowly grown thanks to its Cloud computing ventures and online advertising.
However, as the online retail empire grows, so do efforts of state regulators to keep them within eye-sight. With this, the Justice Department has carried out an anti-trust probe into influential tech firms to find out if their services have been detrimental to the market.
The DOJ did not mention specific tech entities, except to say online retailers were becoming a "widespread problem." And the European Union is checking their books to find out if Amazon has been using information from the small businesses that sell products via its platform.
During a media conference late Thursday, top Amazon executives refused to answer any regulatory concerns. "I have nothing to report on," said Brian Olsavsky, Chief Financial Officer.
The company's sales in the last three months beat Wall Street's expectations, growing to $70 billion, a 24 percent increase. The third quarter featured Amazon's "Prime Day" celebration, which has become one of the major retail events of the year for the business.
Amazon saw a headcount spike as well. At the end of September, it had 750,000 workers globally, up about 100,000 from the preceding three months.
In addition to adding staff to stack and deliver packages in their warehouses, the organization said it was employing more software engineers and salespeople in its cloud service.
Amazon is the second-largest private employer based in the U.S., just behind Walmart's rival.
