Amazon on Thursday reported better-than-expected second-quarter revenue and profit, pushing its shares higher after hours.
The e-commerce giant earned $6.7 billion, or 65 cents per share, for the three months ended June 30, well above the $3.64 billion that industry analysts polled by FactSet had anticipated.
Amazon posted a loss in the same period last year, due to a big loss on its investment in electric vehicle startup Rivian Automotive. Its second-quarter earnings include a $0.2 billion pretax valuation gain in its Rivian investment.
The company said overall revenue was $134.4 billion, up 11% from the same period last year and beating analysts’ expectations of 8.5% growth. .
“It was another solid quarter of progress for Amazon,” Amazon CEO Andy Jassy said in a statement.
The AWS cloud unit, which has been closely watched by investors, recorded revenue of $22.1 billion. But its growth continues to slow.
Part of the slowdown can be explained by the fact that AWS is the market leader in the cloud space, which makes it difficult to sustain the higher levels of growth it had in the early days. But Amazon executives said the company faced short-term headwinds as companies looked for ways to save money by reallocating spending or cutting back on features they didn’t have. need.
In a bid to attract more customers and gain a competitive edge in the race for generative AI where it seems to be catching up, the company has also rolled out AI tools that its customers can use to create their own apps. Last week, he said an AI model called Amazon Bedrock was being used by Irish carrier Ryanair, among others.
Meanwhile, Amazon’s flagship online retail, which had slowed significantly in the aftermath of the pandemic boom, showed small signs of strengthening on Thursday, with growth of 5%, the best since the third quarter of Last year.
Deliveries for customers who shop online are also getting much faster under the retailer’s new regionalization model. Previously, Amazon processed orders from warehouses across the country. But now the company has eight regions across the country that serve smaller areas, helping it achieve a dual goal of lowering costs and delivering items faster to its Prime customers.
During the second quarter, more than half of Prime orders in the 60 major U.S. metro areas arrived the same or next day, the company said Monday, touting what it called its fastest Prime speed ever. . The company also announced plans to double the number of same-day delivery locations in the coming years.
Sales at Amazon’s physical stores, which include its Amazon Fresh and Go stores as well as Whole Foods, were up 7%. The company has ambitions to be a major player in the grocery industry, but has failed to capture significant market share since launching the Fresh and Go chain three years ago. He now operates dozens across the country.
Jassy said earlier this year that grocery presented a big growth opportunity for Amazon, but the company needed to find the right “mass grocery format” that was worth expanding.
On Wednesday, Bloomberg reported that the company plans to add an online service that would allow customers to integrate orders from Whole Foods and other Amazon grocery stores into a single shopping cart. In a blog post, the company also previewed two revamped Fresh stores in Illinois that offer more product selections, self-checkouts, and Krispy Kreme Donut shops. It also began offering grocery deliveries to non-Prime members.
The company said it expects to make between $138 billion and $143 billion in revenue during the third quarter.
—By Haleluya Hadero, Associated Press