One of Amazon’s biggest expenses are shipping costs, which include expenses for sortation, transportation, and outbound delivery by the Postal Service, private carriers, and regional shippers. As to be expected, shipping costs increased just as dramatically as revenues.
Shipping costs for Q2 2018 were $6 billion, up 31 percent from $4.6 billion in Q2 2017. For the first six months of the fiscal year, shipping costs were about $12 billion, up 34 percent from $9 billion for the same period last year. At this rate, by the end of the fiscal year, shipping costs could jump from $21.7 billion in 2017 to nearly $30 billion in 2018.
Amazon’s financial report doesn’t say much about how these shipping costs were incurred. For example, there’s nothing about these basic questions: How many packages does Amazon ship each year? How much do these deliveries cost Amazon? And how are all those deliveries shared by the various carriers — USPS, UPS, FedEx, regional shippers, and Amazon itself?