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Amazon’s first quarter brings another record profit



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Amazon's CEO, Jeff Bezos, at a Wired conference last year.

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Amazon is not growing as fast as it used to, but it is benefiting much more than before.

For its first quarter, Amazon reported a fourth consecutive record gain on Thursday, reaching $ 3.6 billion, or $ 7.09 per share, and puzzling analysts' estimates of $ 4.72 per share, while exceeding your previous year's income of $ 1.6 billion, or $ 3.27 per share.

Revenues increased 17%, to $ 59.7 billion, at the highest end of the company's guide of $ 56 billion to $ 60 billion.

The company expects to record between $ 59.5 billion and $ 63.5 billion in revenues in its current quarter, compared to the $ 62.4 billion forecast by analysts surveyed by Yahoo Finance.

Amazon finance chief Brian Olsavsky said in a call with reporters on Thursday that the huge profit growth was due in part to lower-than-expected costs and to squeezing more efficiencies from Amazon's warehouses.

"[We] It probably has been overestimated a bit as to what we would spend and hire in the first quarter, "he said, but warned that spending should increase by the end of this year.

The world's largest e-commerce company reported its latest numbers after a difficult start to 2019. The company faced a wall of opposition from activists and local politicians for its HQ2 development project in New York, which was supposed to bring 25,000 employees new to the city. In February, Amazon scrapped the project after more than a year of searching for a location. A similar-sized campus is still planned for Arlington, Virginia.

In addition, CEO and founder Jeff Bezos this month. ended his divorce With his wife of 25 years. His new girlfriend and a fight with the National Enquirer newspaper made the usually private executive a regular in the gossip pages.

So far, none of the issues seems to have damaged Amazon's business significantly, and the company's stock has risen 24% this year. Thursday's actions were flat.

Although Wall Street has taken the HQ2 debacle and the divorce of Bezos, is paying more attention to the expense and growth of Amazon. Olsavsky warned in February that Amazon's investments in more infrastructure and contracting will increase this year, which could hurt profits. He reiterated that point again on Thursday, despite the best results in the first quarter. In addition, Amazon is not growing at the same pace as a few years ago, as it is now a much larger company. Time will tell whether Amazon will remain a Wall Street favorite after its revenue growth fell below 20%, a level it had been able to maintain for three consecutive years until this last quarter.

Amazon Web Services, the company's highly profitable cloud computing unit, once again supported earnings growth. AWS in the first quarter reported $ 2.2 billion in operating income, 59% more than the previous year. By comparison, Amazon's North American retail unit, which generates nearly five times more revenue than AWS, posted a slightly higher operating profit than the cloud unit.

The company's "other" revenues, which mainly include its rapidly growing advertising business, posted a weaker 34% revenue growth in the last quarter, to $ 2.7 billion. Olsavsky said on Thursday that the smaller increase was partly due to a change in accounting, adding that the advertising business is growing at a rate greater than 34%.

The total number of employees was 630,600, below a holiday maximum of 647,500, but 12% more than the previous year.

Originally published on April 25, 1:05 p.m. PT
Update, 2:04 p.m .: Add details of the CFO call.


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