Amazon Just Reported ENORMOUS $20 Billion Profits

Amazon’s quarterly profits soar to a record $20 billion, but cloud growth falls short of expectations.

At a Glance

  • Amazon reported $187.8 billion in net sales for Q4, a 10% increase
  • Quarterly profits exceeded $20 billion, an 88% increase from the previous year
  • AWS sales were $28.8 billion, slightly below expected growth
  • Amazon shares fell more than 4% in after-hours trading
  • Amazon employed 1,556,000 full- and part-time employees as of December 31

Record-Breaking Profits Amid Mixed Results

E-commerce giant Amazon has reported a staggering $20 billion in quarterly profits, marking a significant milestone in the company’s financial history. The fourth quarter results showcase Amazon’s resilience in a challenging economic landscape. Despite this remarkable achievement, the company’s performance was met with mixed reactions from investors.

Amazon’s net sales for the fourth quarter reached $187.8 billion, representing a 10% increase from the previous year and surpassing Wall Street expectations. The company’s earnings per share stood at $1.86, significantly exceeding the anticipated $1.48. This financial success demonstrates Amazon’s ability to navigate through economic uncertainties and maintain its dominant position in the e-commerce and cloud computing sectors.

Cloud Growth Deceleration Raises Concerns

While Amazon’s overall performance was impressive, the growth of its cloud computing division, Amazon Web Services (AWS), fell short of expectations. AWS sales reached $28.8 billion, reflecting a growth rate just under 19%, slightly below the projected 19.3%. This deceleration in cloud growth has raised concerns among investors and analysts, as AWS has been a key driver of Amazon’s profitability in recent years.

Despite the slower growth, AWS remains a crucial component of Amazon’s financial success. The cloud division accounted for 15% of total sales but contributed over 50% to Amazon’s operating profits, generating $10.6 billion in operating profits. The slight miss in growth expectations, however, led to a more than 4% drop in Amazon’s shares during after-hours trading.

Diverse Revenue Streams Bolster Performance

Amazon’s financial success extends beyond its cloud services. The company’s online stores saw sales of $75.5 billion, a 7.1% increase, while third-party seller services reached nearly $47.5 billion, up 9%. Advertising revenue showed strong growth, climbing to $17.3 billion, an increase of nearly 18%. Subscription revenue, including Prime memberships, rose to $11.5 billion, reflecting a 9.73% increase.

Physical store revenue also saw positive growth, reaching $5.6 billion, an 8% year-over-year increase. This diversification of revenue streams has helped Amazon maintain its strong financial position, even as some sectors face challenges or slower growth.

As of December 31, Amazon employed 1,556,000 full- and part-time employees, representing a 2% increase from the previous year. This figure excludes contractors and seasonal workers.

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