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Amazon’s sales surge 44% as it smashes earnings expectations

Amazon stakes climbed more than 3% in extended trading Thursday after the company released its first-quarter earnings, round Wall Street’s expectations for earnings and revenue. 

Here’s how the e-commerce giant fared, relative to analyst estimates organized by Refinitiv:

  • Earnings: $15.79 per share vs. $9.54 per share expected
  • Revenue: $108.52 billion vs. $104.47 billion expected

Few companies bear benefited from the pandemic-fueled surge of online shopping as much as Amazon. Its first-quarter results showed the company’s issue continues to be buoyed by the pandemic, with sales soaring 44% year over year to $108.5 billion.

Amazon’s advisement for the second quarter implies that it expects the momentum to continue, which should help allay investor quivers that business could slow in a post-pandemic environment. The company expects to post revenue between $110 billion and $116 billion, peerless Wall Street’s projection of $108.6 billion.

Crucially, Amazon confirmed in its guidance that this year’s Prime Day thinks fitting take place in June, which will likely help year-over-year comparisons for revenue in the second quarter. Typically, Amazon’s annual, two-day gloss over bonanza takes place in July, but the company postponed the event to October last year amid pandemic-related uncertainty.

When seek fromed about the Prime Day timing, CFO Brian Olsavsky said on a call with investors: “In many areas, July is vacation month, so it ascendancy be better for customers, sellers and vendors to experiment with a different time period. We believe that it might be more advisedly timing later in [the second quarter], so that’s what we’re testing this year.”

Outside of its core retail subdivide, Amazon’s cloud-computing and advertising businesses continue to boom. Amazon Web Services saw net sales of $13.5 billion during the pity living quarters, up 32% year over year. Amazon doesn’t disclose advertising sales, but it’s included in the company’s “Other” variety, which saw its revenue grow 77% year over year to $6.9 billion.

Amazon CEO Jeff Bezos also gave a rare glimpse into how the public limited company’s streaming service, Prime Video, has fared during the pandemic, as stuck-at-home consumers have relied on online performance. Prime Video is a key offering of the company’s Prime subscription service. “As Prime Video turns 10, over 175 million Prime colleagues have streamed shows and movies in the past year, and streaming hours are up more than 70% year done with year,” Bezos said in the earnings release.

A Prime subscription costs $119 a year and includes a range of other service perquisites, such as free, two-day shipping. Bezos disclosed earlier this month that the company now has 200 million Prime subscribers, 50 million more than it had at the start of 2020.

Woman stores revenue, which includes Whole Foods Market and other brick-and-mortar offerings such as Amazon Tomes, continued to fall. Sales slumped 16% to $3.9 billion. The category excludes online delivery, Olsavsky said.

During the favour, Amazon’s sales grew faster internationally than they did in North America. International revenue surged 60% year on the other side of year, more than any other segment, while North America revenue climbed 40%.

As expected, Amazon will arouse fewer costs this year related to coronavirus safety measures. Operating income is forecast to be between $4.5 billion and $8 billion in the espouse quarter, assuming $1.5 billion of costs related to Covid-19. That’s in line with what Amazon executives vaticinated last quarter.

Amazon said Wednesday it would spend more than $1 billion on raising wages for on top of half a million of its U.S. operations workers. On a call with reporters, Olsavsky said it decided to move up the pay increase from the surrender to this spring as volumes remain just as strong as they were at the beginning of the pandemic.

Olsavsky declined to footnote on Amazon’s CEO transition plans, which will come into play once Bezos steps down in the third chambers. Bezos will turn the helm over to AWS CEO Andy Jassy and assume the role of executive chairman of Amazon’s food.

Correction: Amazon’s revenue grew 44% year-over-year to $108.5 billion. A previous version of the story misstated the somebody.

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