Amazon reported robust first-quarter 2024 results, with revenue of US$143.31 billion, a 13% increase compared to the same period last year. Net income reached US$10.43 billion, or US$0.98 per share, significantly exceeding Wall Street analysts' expectations, who had predicted US$0.84 per share.
"It was a good start to the year across all business segments, as seen both in improvements to the customer experience and financial results," said Andy Jassy, Amazon CEO, in a statement.
The Seattle-based e-commerce giant saw above-expectations results during the holiday shopping period, fueled by strong consumer spending, aided by discounts and faster delivery times. The company held another promotional event in late March, just before the first quarter closed.
According to Brian Olsavsky, Amazon's CFO, American customers are being "very cautious" with their spending, seeking promotions and opting for more economical products. He noted that the company is seeing, "particularly," a reduction in spending in Europe.
AWS accelerating
The company's cloud computing division, Amazon Web Services (AWS), reported US$25.04 billion in sales for the first quarter, a 27.03% increase year-over-year. AWS, whose customers are primarily businesses, has been a cornerstone of Amazon's strategy in the competitive AI race among major tech companies.
Jassy stated that AI resources have accelerated the growth rate of AWS, which is now on track to reach US$100 billion in annual revenue. Hours before the earnings release, Amazon announced the full launch of a business chatbot called Q, promising to help employees be more productive at work.
Advertising is strong, including Prime Video.
Online advertising sales for the company jumped 241% year-over-year, primarily driven by sponsored product ads. Olsavsky noted that Amazon, which began displaying ads on Prime Video at the end of January, currently has a "light" ad presence on its streaming service compared to television or other providers.
"Ad performance is strong, attracting several new advertisers who weren't previously using Amazon's advertising services," said the CFO, referring to the Prime Video initiative that allows customers to avoid ads for a monthly fee of US$2.99."
Amazon stock rose approximately 2% in after-hours trading, reflecting investor confidence in the reported results.
For the second quarter, Amazon expects net sales between US$144 billion and US$149 billion, while analysts estimate US$150.2 billion.
