Amazon subleases warehouses as online stores slow down Associated Press
Amazon plans to sublease part of its warehouses now that a pandemic-led surge in online shopping that has helped the e-commerce giant make high profits in the past two years has weakened.
The sublease allows the company to “withdraw financial obligations related to an existing building that no longer meets” its needs, Amazon spokeswoman Alice Carroll said.
Carroll did not disclose how much space the company plans to sublease. But citing anonymous sources, Bloomberg News and The Wall Street Journal reported earlier that the retailer would sublet at least 10 million square feet and could cancel more of its leases in states including New York, New Jersey and California .
Seattle-based Amazon has doubled its volume during the pandemic, adding more warehouses and workers to keep up with consumer demand, who came home who felt more comfortable buying things online. But when the worst pandemic eased, it had too many warehouses and too many workers.
“Sublease is something many well-known corporations do to help manage their real estate portfolio,” Carol said.
Last month the company reported its first quarterly loss since 2015, fueled by the slowdown in e-commerce and the massive write-off of its investment in Rivian Automotive’s electric startup. In a statement released last month with earnings results, CEO Andy Jesse said the company is now focused on improving productivity.
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