Amazon cloud income jumps 45 pc in fourth quarter

03 February, 2018, 03:38 | Author: Terri Saunders
  • Amazon cloud income jumps 45 pc in fourth quarter

"Our 2017 projections for Alexa were very optimistic, and we far exceeded them", said Bezos.

On a full-year basis, the Seattle-based retailer said net sales surged 31 per cent to $177.9 billion (£125 billion), compared with $136 billion in 2016. Net income rose to $1.86 billion, or $3.75 a share, from $749 million, or $1.54 a share, in the same period a year ago.

AWS, which competes with Microsoft Corp's Azure and Alphabet's Google Cloud platform, reported a 45% rise in revenue to $5.1 billion in the quarter, giving the business an annual run rate of over $20 billion. The company forecasts an operating income to be between $300 million and $1 billion compared to $1 billion in the first quarter of 2017. Amazon noted that the fourth quarter earnings includes a tax benefit of roughly $789 million due to the change in USA tax code. "We don't see positive surprises of this magnitude very often-expect us to double down", said Jeff Bezos, Founder and CEO, in the financial report. More than half of the units sold on the company's website come from these merchants. Wall Street was expecting earnings per share (EPS) of $1.85, so Amazon absolutely crushed it. Despite the huge growth in revenue, Amazon's operating profit dropped 2 percent to $4.1 billion. But even without the benefit, the profit number would have been the largest in the company's history.

According to an SEC filing, Bezos owns about 78.9 million shares of Amazon, which jumped about $85 a share higher in early trading on Friday. Alphabet's Larry Page and Sergey Brin lost as much as $3 billion apiece as fourth-quarter earnings missed views.

Amazon has been in heavy investment mode in recent quarters, pouring money into warehouse and data center expansion, while adding more video content for its Prime Video offering. AWS continues to be the fastest and most profitable business for Amazon.

Amazon shipped more than five billion packages globally in 2017, as it had more paid users join compared to the previous year.

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Operating income skyrocketed 69% year over year to $2.13 billion in the quarter.

"We've reached an important point where other companies and developers are accelerating adoption of Alexa", Bezos said.

Amazon's headcount also swelled past year. Visit MarketWatch.com for more information on this news. Amazon's voice-activated Alexa platform will also get more funding, with Bezos pledging to "double down" on finding new uses for the technology that supports the popular Echo home speakers.

In a call with investigators, Amazon's CFO Brian Olsavsky credited record arrange volume and enhanced distribution center proficiency amid the bustling Christmas shopping season for the fruitful quarter.

Amazon's income, which incorporates deals from Whole Foods, hopped 38 percent year-over-year.

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