Amazon Stock Jumps After Topping Earnings Expectations

amazon earnings

Amazon Inc (NASDAQ: AMZN) reported its first quarter earnings report after markets closed on Thursday, with both profit and revenue beating expectations of Wall Street analysts. The online retail giant said net income more than doubled in the quarter, while net revenue rose 17%.

Shares of the company climbed $28.75, or 1.51% to $1,931.00 in after-hours. The stock, which has gained 27% since the beginning of the year, ended the regular trading session at $1,902.25. Amazon is currently the third most valuable corporation on the planet after Microsoft Corp (NASDAQ: MSFT) and Apple Inc (NASDAQ: AAPL).

AMZN Earnings & Outlook

Amazon posted first quarter earnings of $3.6 billion, or $7.09 per share, up from earnings of $1.6 billion, or $3.27 per share in the same period last year. That beat estimates of $4.72 per share, according to analysts surveyed by Refinitiv.

Net revenue jumped 16.9% to $59.7 billion, compared with 43% growth in the first three months of the previous year. On average, analysts surveyed by Refinitiv were also expecting revenue of 59.7 billion. Amazon had provided a downbeat first-quarter revenue forecast of $56 billion to $60 billion in February.

In Q1 2019, Amazon’s North American division brought in revenue of $35.8 billion, up 17% from the first quarter of calendar 2018. The company’s international segment posted revenue of $16.2 billion in the quarter, a 9% jump on a year-over-year basis. Amazon Web Services, which houses the company’s cloud computing operations, saw revenue rise 41% to $7.7 billion.

Amazon said sales in its physical stores, including Whole Foods grocery chain, grew 1% to $4.3 billion. Revenue from the company’s other segments (which includes ad business) increased 36% to $2.7 billion. The Seattle-based company had posted ad revenue growth of 132% in the March quarter of fiscal 2018.

Looking ahead, Amazon expects net revenue to rise between 13% and 20% to $59.5 billion to $63.5 billion in the second quarter. Additionally, the company predicts that operating income will come in between $2.6 billion to $3.6 billion, versus $3 billion in the earlier-year period.

Amazon Inc Profile

Amazon is among the world’s highest-grossing online retailers, with $233 billion in net sales and $408 billion in estimated global gross merchandise volume in 2018.

Online product and digital media content sales accounted for 53% of net revenue in 2018, followed by commissions, related fulfillment and shipping fees, and other third-party seller services (18%), Amazon Web Services’ cloud compute, storage, database, and other offerings (11%), Prime membership fees and other subscription-based services (6%), product sales at Whole Foods and other physical store retail formats (7%), and advertising services and cobranded credit cards (4%).

International segments constituted 32% of Amazon’s non-AWS sales in 2018, led by Germany, the United Kingdom, and Japan.