Amazon's Drone Delivery Takes Flight in Italy as Stock Soars 49% This Year
2min read As of last week, Amazon (AMZN) saw a consistent upward trend, appreciating by 2.94% over six consecutive days, contributing to a 10.35% gain over that period. The past week alone brought a 9.21% increase, and since the start of the year, the stock has skyrocketed by 49.42%, positioning its market value at $2,387.23 billion.
Amazon has successfully completed its initial drone delivery tests in Italy, marking the first European country where the e-commerce giant plans to implement this service. The company announced its intention to collaborate with Italian authorities to meet all the requirements necessary for launching this service by next year. Previously, Amazon had shared its goal to introduce drone services in Italy and the UK by the end of 2024. In August, the UK's aviation regulator selected Amazon among six projects to explore drone applications in delivery and emergency services.
Amazon revealed that the Prime Air drone package delivery service, introduced in December 2022, is currently operational in select locations across Texas and Arizona, with plans to expand further. The test flights in Italy utilized the new MK-30 drone, an advanced automated system employing Amazon's leading-edge computer vision technology, designed to navigate safely around obstacles and protect personnel, animals, and property.
On a separate front, Amazon is enhancing its artificial intelligence offerings, unveiling powerful new chipsets and large language models aimed at competing with prominent rivals. The company is assembling clusters of hundreds of thousands of its Trainium2 semiconductors to enable partners like Anthropic to more efficiently train the extensive language models needed for generative AI tasks. This new array is expected to quintuple Anthropic's existing processing capabilities.
Amazon's CEO, Andy Jassy, introduced a new AI model named Nova, capable of generating text, images, and videos, marking the company's latest venture to rival giants like OpenAI in the field of large language model-based AI tools. AWS, Amazon’s cloud services unit, remains a predominant provider in renting computational strength for AI applications, also offering models developed by others such as Anthropic's Claude. Despite its efforts, AWS has yet to produce a model that starkly rivals OpenAI's advanced GPT models.
In the wake of the Black Friday sales event, Amazon experienced difficulties with inventory intake at its warehouses, resulting in significant inconvenience for sellers. Reports indicate that certain warehouses will temporarily suspend the receipt of goods from December 15 to December 31 due to exceptionally high demand and limited scheduling availability. This measure, likely a strategic move to manage the operational pressures of the upcoming Christmas shopping spree, particularly affects warehouses operating beyond their capacity, posing challenges for sellers dependent on these locations.
Moreover, starting January 15, 2025, Amazon plans to adjust its multi-channel fulfillment service fees, with an average increase of 3.5%. The adjustments consider product dimensions and weight, maintaining current fees for standard delivery of items weighing one pound or less, while recalibrating charges for heavier items. To encourage efficient inventory management, Amazon is offering discounts on its AWD storage option, set to take effect from April 2025.
Overall, as Amazon progresses with shipping innovations and AI advancements, its logistical strategies and cost structures continue to evolve, reflecting its ongoing efforts to maintain leadership in the competitive e-commerce and cloud computing markets.
