Amazon’s quarterly profit jumps to $7.8 billion.
Amazon followed a trend among the nation’s biggest tech companies on Thursday. The company said it made more money in the last quarter compared to last year – a lot more money.
The company said sales in the three months ending June hit $ 113.1 billion, up 27% from the previous year, when lockdowns were at their most extreme. It made $ 7.8 billion in profit, up 48% from $ 5.2 billion a year ago.
The results were a sign that even as businesses reopened after the peak of the pandemic, many people continue to shop online, and a large chunk of those businesses continue to follow Amazon’s path. The other biggest tech companies – Apple, Facebook, Google and Microsoft – also posted blockbuster results this week.
But Brian Olsavsky, The company’s chief financial officer said on a call with reporters that online sales growth had slowed in part because more people were shopping in person and spending time on vacation or socializing. “It’s okay,” he said, “but that tends to get them to do more than just shopping. “
Amazon shares fell more than 5% in the aftermarket, with investors expecting sales to be even higher and the outlook for the next quarter more optimistic. Amazon is valued at around $ 1.8 trillion, more than double its pre-pandemic value.
Amazon’s profits exceeded investor expectations as its top-grossing businesses continued to thrive. Its cloud computing division is now larger than most companies – Morgan Stanley estimates it is worth $ 600 billion – and growth continues to be strong. Cloud computing sales rose 37% to $ 14.8 billion. Its “other” business segment, which is primarily its advertising business, grew 87% to $ 7.9 billion. And within its mainstream business, Amazon’s revenue from the fees it charges marketplace sellers totaled $ 25 billion.
Subscriptions, mostly Prime subscriptions, brought in $ 7.9 billion. About 200 million people are now Prime members, and a recent analysis by Consumer Intelligence Research Partners found that they buy from Amazon 27 times a year on average, almost twice as often as customers who are not Prime members.
Amid a construction boom to expand its fulfillment and delivery network, the company has added 64,000 more workers in the past three months and now employs more than 1.3 million people, or 52% more than at the same time last year. In the competitive job market, Amazon has raised wages, which Mr. Olsavsky called “one of the biggest inflation factors in our business right now.” He said the company plans to open many new facilities in the coming months as the holiday shopping season approaches.
Comparing Amazon’s performance with last year is somewhat difficult this quarter. Last year, the company saw a huge increase in sales after adjusting its staff and other parts of its business to better meet demand fueled by the pandemic. But also this year, Amazon’s Prime Day event dropped in June instead of October, giving a new boost to revenue this quarter. JP Morgan estimated that this year’s event generated around $ 8.4 billion in revenue.
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