Amazon profit beats expectations on booming sales
Amazon on Thursday reported a quarterly profit that trounced market expectations, driven by strong sales helped by its annual Prime discount event. The tech giant said it made a profit of $6.7 billion in the recently ended quarter, eclipsing earnings forecasts. «It was another strong quarter of progress for Amazon,» the company's chief executive Andy Jassy said in an earnings release.
Amazon shares were up more than 7 percent to $138.79 in after-market trades that followed the release of the earnings figures. Net sales revenue at Amazon increased 11 percent to $134.4 billion, compared with $121.2 billion in the same quarter a year earlier, the earnings report showed. The e-commerce colossus boasted of having its «biggest Prime Day event ever» in July, with subscribers to the Amazon service worldwide ordering more than 375 million items.
«The upturn in Amazon's commerce business is an encouraging sign for the back half of the year,» said Insider Intelligence principal analyst Andrew Lipsman. Flourishing online sales also promise to boost Amazon's profitable advertising business, Lipsman added. Amazon is seeing strong demand for advertising services on its platform, which includes «Prime» streaming television and music services, according to Jassy.
Order delivery speeds in the US were the fastest ever, with Amazon continuing to work on optimizing efficiency and lowering costs at fulfillment centers, according to the company. «We continued lowering our cost to serve in our fulfillment network, while also providing Prime customers with the fastest delivery speeds we've ever recorded,» Jassy said. Investors are keen to see whether a tightened budget and improved efficiency is paying off for Amazon.
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