BENGALURU: Amazon Seller Services, which runs the local marketplace of the US e-commerce giant in India, suffered a loss of about Rs 6,290 crore — close to $1 billion — in the year ended March 2018, a jump of 30% from the year before.
This takes the total loss incurred by India’s top three e-commerce companies to a whopping Rs 11,300 crore for the last financial year. As reported earlier, the two main entities of Flipkart together with Paytm Mall, the commerce arm of Paytm, incurred losses of Rs 5,000 crore in the year. The losses are rising as the fight between these players have become intense.
Amazon Seller Services reported a loss of Rs 4,830 crore in the year ended March 2017, documents sourced from business intelligence platform Paper. vc show. The payments business of Amazon India and Flipkart’s PhonePe together reported a loss of around Rs 1,150 crore for the last year.
Amazon India’s revenue grew by almost 60% to Rs 4,928 crore in the last fiscal. The entity earns revenue from multiple avenues, the major one being the marketplace services to third party sellers for connecting them to end consumers. It earned almost Rs 3,550 crore for offering marketplace services, and it garnered an additional 1,100 crore for providing marketing services.
In comparison, Flipkart India (the wholesale arm) revenue grew by about 40% to Rs 21,600 crore, while the marketplace entity, Flipkart India, reported a 35% jump in revenue to around Rs 3,000 crore. Amazon’s revenue from its wholesale arm is not clear yet.
Amazon has been investing heavily in India, after losing China to Alibaba. It has committed an investment of $5 billion in India, much of which has already been spent. It infused over Rs 5,400 crore in just the past few months. Amazon India’s overall expenses shot up to Rs 11,305 crore last fiscal, as against Rs 8,087 crore in the year before. Advertising and promotional expenses rose to Rs 2,109 crore, from Rs 1,820 crore. An email sent to Amazon India about the financials did not elicit a response
The development was designed by ET Retail.com