Point Mobile Expects Benefits from Amazon's Entry into Offline Stores

Amazon to Open Department Store-Style Offline Stores in California and Ohio
Expecting Large Supply of Various PDA Products for Department Stores, Warehouses, and Delivery Use

[Asia Economy Reporter Kim Heeyoon] As the world's largest e-commerce company Amazon's plan to open department store-style large offline stores in the United States has been revealed, domestic industrial PDA manufacturer Point Mobile is gaining attention.

Earlier, the Wall Street Journal reported on the 19th (local time), citing well-informed sources, that Amazon is expected to open its first department store-style offline stores in Ohio and California.

The WSJ reported that Amazon is expected to sell clothing, furniture, electronic devices, and other products under its own brand at the department store-style offline stores. Amazon, which has been expanding offline stores centered on bookstores and grocery stores, also acquired the U.S. grocery store Whole Foods Market in 2017.

Accordingly, Point Mobile, which supplies industrial PDAs to Amazon, is expected to benefit.

Point Mobile signed an $200 million industrial PDA supply contract with Amazon for eight years in July last year. Based on this, it is accelerating its global expansion into the U.S., Europe, and other markets.

Industry insiders expect Point Mobile's sales to Amazon to reach 41.5 billion KRW, more than five times the previous year. Operating profit margin is also expected to increase by 18.1 percentage points from the previous year to 18.3%, due to the leverage effect from expanded sales.

At the time of the contract, Amazon agreed to receive warrants if the $200 million (approximately 220 billion KRW) supply deal with Point Mobile is completed. The agreement stipulates that once Point Mobile completes the supply of barcode scanners used in Amazon's logistics centers, Amazon will have the right to purchase shares at a pre-agreed exercise price. If Amazon exercises the warrants, it will become the second-largest shareholder of Point Mobile.

Amazon operates 2,427 logistics warehouses in 29 countries worldwide, with more than half located in the U.S. and India. Since 2019, Point Mobile has exported industrial PDAs used in Amazon logistics centers in the U.S., India, Japan, and other countries.

With the prolonged COVID-19 pandemic causing a surge in logistics demand, the demand for industrial PDAs at Amazon logistics centers has also increased. Earlier, Point Mobile expected about 40% (approximately 40 billion KRW) of its annual sales target of 93.3 billion KRW this year to come from Amazon. Already, about 9.9 billion KRW in sales were generated from Amazon in the first quarter.

Kang Samgwon, CEO of Point Mobile, said, "One of our main sales markets is the retail market such as department stores, and Amazon, which will become the second-largest shareholder of Point Mobile, entering the offline department store business is expected to contribute significantly to Point Mobile's sales in addition to the existing Amazon e-commerce market." He added, "Especially since Amazon's offline department store business is expanding nationwide across the U.S., we expect large-scale supply of various PDA product lines for department stores, warehouses, and delivery."

This content was produced with the assistance of AI translation services.