Amazon's quarterly profits soar to US$2.5 billion

Ann Santiago
July 30, 2018

During the event, called Prime Day, popular brands now agree to put their inventory on sale for members of Amazon's loyalty club Prime, while rival retailers scramble to drive traffic back to their websites.

At least 16 brokerages raised the price target on the stock with several saying that the high levels of profitability may be a new normal for the company. Amazon expects revenue in the range of $54 billion to $57.5 billion in the third-quarter, slightly below street estimates of between $55.6 billion to $62.2 billion. Since taking over Whole Foods, Amazon has lowered prices and expanded same-day delivery in a bid to attract more shoppers to the grocery chain.

According to the research firm eMarketer, Amazon's e-commerce revenue will grow more than 28 per cent this year to reach US$394 billion, and will account for 49 per cent of USA online retail sales and almost five percent of all retail spending. As a result, the company has an EPS growth of 59.66% for the approaching year.

One of the most popular features for using Alexa-powered devices is the ability to listen to music, he said.

Amazon Web Services, the company's cloud-computing business, again accounted for much of its growth. Amazon's "other" revenue, which is largely comprised of ad sales, grew a whopping 132% in the quarter to $US2.2 billion.

Sales from other businesses - mostly advertising - surged 129 per cent to US$2.2 billion, just below the growth rate from the first quarter.

Though Amazon's financial results and forecasts are decidedly more optimistic than Facebook's were, the company has not entirely evaded the increased political scrutiny now facing the US's major technology companies.

All parts of Amazon's posted strong gains, but its advertising business and its North American retail segment were standouts. Total operating income reached US$2.98 billion, up from US$628 million the year before, while Amazon reported earnings of $5.07 of per diluted share, compared to 40 cents per diluted share year-over-year.

The company is working to automate tasks for advertisers and to help media buyers measure the results, Olsavsky said.

Hiking the annual U.S. price of Prime 20 percent during the second quarter showed few signs of discouraging sign-ups.

Amazon Web Services (AWS) saw its revenue jump by almost half in Q2, which analyst Synergy claims sees the public cloud leader increase its market share over Microsoft and Google.

Chief executive and founder Jeff Bezos, whose Amazon stake has made him the world's richest person, used the quarterly update to highlight Alexa, the digital assistant that powers Amazon electronics along with cars, appliances and other connected devices.

The Financial stock finished its last trading at $18.39 while performed a change of 0.55% on Thursday.

The top-selling item in the United States was the Instant Pot, while the Bosch cordless drill took the title in the UK.

July 17 was the biggest sales day for smart home devices in Amazon's history.

Shoppers purchaed more than five million toys, beauty products, PCs, apparel items and kitchen products.

"The business has accelerated in the last three quarters, and we're seeing great signs in a number of areas".

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