E-commerce giant Amazon (AMZN) has reported better-than-expected financial results, driven largely by growth in its cloud computing and online advertising businesses.
The Seattle-based company announced earnings per share (EPS) of $1.43 U.S., which was much better than the $1.14 U.S. that had been expected on Wall Street.
Revenue in this year’s third quarter totaled $158.88 billion U.S. compared to $157.20 billion U.S. that was forecast among analysts who follow the company’s progress.
Amazon Web Services (AWS), the company’s cloud computing unit, earned revenue of $27.4 billion U.S., which was slightly below the $27.5 billion U.S. that had been estimated.
However, cloud computing is growing faster than in the same period of 2023, with sales rising 19% year-over-year during the quarter.
Advertising sales in Q3 totaled $14.3 billion U.S., which matched expectations.
Advertising too is growing at a brisk pace, rising nearly 20% from a year earlier and outpacing growth in Amazon’s online retail business.
Among online ad companies, Amazon showed the strongest growth, eclipsing the gains seen in both Meta Platforms (META) and Alphabet (GOOGL) during the quarter.
Amazon’s capital expenditures grew 81% year-over-year to $22.62 billion U.S. in Q3 as the company continues to invest in data centres and equipment to power its artificial intelligence (A.I.) products.
Amazon has launched several new A.I. products for its cloud and e-commerce businesses, and is expected to announce a new version of its Alexa voice assistant powered by A.I.
Management said that they expect to spend about $75 billion U.S. for all of this year and even more in 2025.
As for guidance, Amazon forecast revenue in the current quarter to be between $181.5 billion U.S. and $188.5 billion U.S., which would represent year-over-year growth of 7% to 11%.
Prior to today (Nov. 1), Amazon’s stock had risen 24% this year and was trading at $186.19 U.S. per share. The stock is up 7% on news of its Q3 print.
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