Amazon CEO Jeff Bezos. Picture: REUTERS/MIKE SEGAR
Amazon CEO Jeff Bezos. Picture: REUTERS/MIKE SEGAR

Amazon CEO Jeff Bezos says the e-commerce giant has exceeded 100-million paid Prime subscribers and will continue to invest to meet "ever-rising" customer expectations.

Bezos noted the milestone in his annual shareholder letter, published recently. The letter is Bezos’s opportunity to underline his long-term strategy for investors, seeking to bolster their confidence as he continues to plough Amazon’s money into expanding globally, building a brick-and-mortar presence, and inventing new products.

Prime subscribers pay monthly or annual fees in exchange for quick delivery of online orders, music and video streaming and free online photo storage. The memberships encourage consumers to shop more with Amazon to get their money’s worth.

Amazon took its memberships a step further with additional digital perks, and sells add-ons such as a more robust music catalogue for an additional monthly fee. Amazon has kept its Prime subscriber number a closely held secret, forcing analysts to estimate the figure based on shopper surveys.

Bezos’s comments showed the Seattle-based company was selling Prime memberships overseas, demonstrating it could replicate its US success abroad, said RJ Hottovy, an analyst at Morningstar. Amazon was losing money with its international expansion, but investors would be patient if the firm was gaining Prime subscribers, he said.

"What we’re seeing in Europe and other markets is similar to what we saw in the US between 2010 and 2014," Hottovy said. "People see value in Prime memberships in terms of shipping speed and content. It’s important to investors because membership retention rates are north of 90%."

Bezos said in 2017 Amazon shipped 5-billion items and more new members joined Prime than in any previous year. Its shares rose 1.8% in early trading on Thursday.

Bloomberg

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