'Alexa was very busy': Amazon reports record profits and strong holiday season

02 February, 2019, 08:08 | Author: Mary Valdez
  • Amazon wage hike pays off as it reveals record profits

True, the Seattle behemoth keeps hitting at least 20 percent revenue growth quarter after quarter - a huge success considering Amazon's size - thanks to its aggressive expansion efforts.

Amazon reported strong Q4 2018 revenues in all parts of its business on Thursday afternoon.

Shares of the company fell 1.1 per cent to US$1,700 in trading after the bell.

The company began removing a wide array of products from its India website late on Thursday to comply with the new foreign investment curbs that kick in on February 1, Reuters reported.

Sales will be US$56 billion to US$60 billion in the current period, compared with analysts' average estimate of US$61 billion.

The company's profits for the quarter were also up, reaching three billion dollars (£2.2 billion), compared to 1.9 billion dollars (£1.5 billion) this time past year.

The $7.4 billion in cloud revenue for the quarter ending December 31 marked year-over-year growth of 45 percent at AWS-$130 million more than analysts had predicted.

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Amazon increased the price of Prime a year ago, and free two-day shipping has become a common offering from other retailers.

Amazon's digital ad business continued to grow well in the quarter, and it is working with big brands on improving tools and features, chief financial officer Brian Olsavsky said during an earning call with analysts. The company has more than 100 million Prime members globally. The stock closed Thursday at $1,718.73, up 2.8 percent. Earnings surged to $3 billion, or $6.04 a share, handily beating analysts' expectations of $5.67, according to Yahoo Finance.

"Alexa was very busy during the holiday season", Bezos stated. But first-quarter guidance came in a bit light of estimates.

The big picture: Amazon revealed that during the holiday season, tens of millions of customers started Prime free trials or started paid memberships.

The rising shipping costs demonstrate the larger shift toward online shopping.

Amazon posted another record profit last night as it beat Wall Street's fourth-quarter forecasts but gave investors cause for concern with a disappointing outlook. Amazon in October pledged to pay all of its warehouse employees at least $15 an hour, while eliminating some bonuses and stock awards. For the full year, EPS is expected to rise 335% year over year to $19.86 per share, while full-year revenue of $232.37 billion would represent a 30.6% increase year over year. Amazon has not fully rolled out an attribution program it tested a year ago, which let advertisers detect when their digital ads led to sales on its site. The online retailer's brick-and-mortar strategy also includes bookstores and a cashierless convenience store called AmazonGo, which lets customers check in with a smartphone app and be charged automatically based on what they remove from the store.

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