Shares of the company jumped almost 13 percent to US$679 in extended trading today.
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Amazon joined Facebook as one of the few bright breaks in a storm of negative results from players like Apple, Google, Microsoft and Intel. Results which overall have now led to Amazon suggesting Q2 revenue for 2016 should be somewhere in the region of $28 billion and $30.5 billion. Interestingly enough, that is better still than the $482 million Amazon took home in the always lucrative fourth quarter fueled by holiday spending.
Last year in the same quarter, Amazon reported a net loss of $57 million, so Thursday’s report showed how far the company has come in the past year. Revenue surged 28.2 per cent to $29.13 billion.
Web services, launched 10 years ago, delivered more profit in the quarter than Amazon’s retail business. AWS customers include firms like Netflix, Comcast, TIME parent Time Inc, and many, many startups.
Over the past year, the e-commerce giant gained 53% in stock value. That strategy builds on the success of programs including “Mozart in the Jungle” and “Transparent”, which each have won Golden Globe awards. It hopes the new $8.99 monthly subscription plan will appeal to lower income customers who may not want to pay for a full year at once. Aside from last quarter’s earnings miss for Amazon, the prior 3 quarters posted big positive surprises as well, averaging 116.6 percent. “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.
Meanwhile, Slice Intelligence analysis indicates Alexa products account for 26% of Amazon device unit sales and 41% of dollar sales, beating the Kindle by seven percentage points. “But we see opportunities where we need to add additional capacity and we’re filling those voids”.
In prepared press statements, Amazon founder and CEO Jeff Bezos chose to focus on the company’s in-house consumer-electronics products. Echo too is off to an incredible start, and we can’t yet manage to keep it in stock despite all efforts.
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Amazon’s Q1 net sales increased 28% to $29.1 billion in the first quarter, compared to $22.7 billion a year ago.
