Andy Jassy spoke in depth about AWS and AI during a Q3 earnings call, but reiterated the importance of the company’s store progress.

Amazon’s online store net sales in the third quarter grew 2% year over year to $68.5 billion. The company’s physical store net sales increased at the same rate to $5.7 billion, according to a Thursday press release.

CEO Andy Jassy — who spoke at length about Amazon Web Services and AI investments on an analyst call — thinks retail is still an important part of the broader business.

“In stores, I think some folks are sleeping a bit on how much progress that business has made and what it's become in the last few years,” Jassy said on the call. “I'm not aware of another retail business approaching Amazon's revenue size — hundreds of billions of dollars, with double-digit operating margins inclusive of ads — that's growing at this pace.”

The executive noted that fresh groceries and everyday essentials grew three times faster than the rest of the store business, as customers who shop perishables with same-day delivery purchase nearly seven times more essential units than those who don’t.

“This is an important shift as it allows Amazon to win in a category that offers regularity and repetition,” GlobalData Managing Director Neil Saunders said in emailed comments Thursday. “That, in turn, makes Amazon stickier, makes the fulfillment network more efficient, and improves perceptions around the value of Prime and other services.”

Amazon earlier this year shifted its Prime Day event from Q3 to Q2, which meant the retail sales and ad revenue benefit from that e-commerce event made the year-over-year comparison for Q3 tougher.

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