These virtual servers are available in a variety of configurations, each with differing amount of CPUs, memory, storage and network performance, and are billed based on an hourly rate. The company’s retail sales in North America jumped 27 percent to almost $17 billion for the quarter, while its international retail sales rose 24 percent to $9.57 billion.Īmazon said revenue in the current quarter is expected to be between $28 billion and $30.5 billion, with operating income between $375 million and $975 million.EC2 (Elastic Compute Cloud) virtual servers make up the backbone of a cloud deployment on AWS. Online sales in 2016 are expected to reach about $385 billion in the United States, or 8 percent of total retail sales, according to eMarketer, a technology research firm.Īmazon is the rare technology company of its size to still deliver double-digit revenue growth. Investors believe that even at that size, the company can become a lot bigger because online commerce still represents a relatively small portion of total retail sales. Last year, Amazon reached $100 billion in annual sales. He said customers bought twice as many Fire tablets during the first quarter as they did a year earlier, and he said the company could not keep its Echo intelligent speaker in stock. Bezos, Amazon’s chief executive, highlighted the performance of another growing area of investment - hardware devices - though with the lack of detail that has often characterized Amazon disclosures. In a statement announcing the earnings, Jeffrey P.
On a conference call, Brian Olsavsky, Amazon’s chief financial officer, said the company continued to make hefty long-term investments in initiatives, singling out original content for its Prime video service. up 64 percent from a year earlier - amounted to less than 9 percent of total revenue. represented 56 percent of Amazon’s total operating income, even though the $2.57 billion in revenue from A.W.S. more than tripled in the quarter to $604 million. A.W.S., as the business is known, is the most popular cloud service for start-ups and for a growing number of big companies that want to rent computing capacity, rather than run their own hardware and software.Ĭloud computing is also much more profitable than Amazon’s North American retail business, which runs on thinner margins, and its international retail business, which runs at a loss. The biggest source of the company’s profits is Amazon Web Services, the cloud computing business that started just over a decade ago and is now on track to bring in more than $10 billion a year in revenue. Facebook, by contrast, reported that its net income for the first three months of the year tripled to $1.5 billion from a year earlier. On the income side, it was fantastic.”įor the last four quarters, Amazon has run in the black, even if it is still not quite as profitable as some technology companies.
“I saw the number, and I thought, ‘O.K., did I read this wrong?’” Mr. The results were well above the average estimates of analysts surveyed by Thomson Reuters for earnings of 58 cents a share and revenue of $27.98 billion. “It’s more of a big deal after some of the disappointing numbers from Apple and others.” “The fact that they’re profitable is a big deal,” said Christian Magoon, chief executive of Amplify Investments, a fund manager that counts Amazon as a top holding. Investors were happy to see the company show profits after the disappointing run of reports from Apple, Google, Microsoft and Intel. Revenue at the company rose to $29.13 billion from $22.72 billion a year ago.Īmazon’s share price jumped more than 12 percent in after-hours trading after the results were released.
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