...March 11, 2024 We expect ongoing efficiency gains to support strong results in 2024. Amazon's shift to a regionalized fulfillment model in the U.S. last year has placed merchandise closer to customers, shortening delivery distances, improving inventory management, and increasing productivity. This enabled the company to lower its fulfillment and shipping costs on a per unit basis last year for the first time since 2018. We expect Amazon will look to lower costs further this year through improvements in inbound inventory logistics, while accelerating delivery speeds. Cash flow trends continue to strengthen on higher operating margins. S&P Global Ratings- adjusted EBITDA margin expanded 460 basis points (bps) in fiscal 2023 to 20.9%, and we project an additional 240 bps improvement in 2024. Good operating performance, better working capital efficiency, and a temporary pull back in capital expenditures (capex) enabled Amazon to generate $32 billion of reported free operating cash flow (FOCF)...
