Market Commentary

Amazon Gains After Positive Earnings Announced

Rahul Joshua
6 Feb 2024 · 1 minute read

Amazon (AMZN:US) opened over 6% higher on Friday after the e-commerce and cloud-computing giant reported robust sales and profit growth in the third quarter, surpassing analysts' expectations. 

“We had a strong third quarter as our cost to serve and speed of delivery in our Stores business took another step forward, our AWS growth continued to stabilize, our Advertising revenue grew robustly, and overall operating income and free cash flow rose significantly,” said Andy Jassy, Amazon CEO.

Earnings per share amounted to $0.94, which exceeded the $0.58 expected by analysts. Revenue reached $143.1 billion, outperforming the anticipated $141.4 billion.

Amazon Web Services, the company’s cloud business, generated $23.1 billion in revenue, slightly below the expected $23.2 billion. Advertising revenue amounted to $12.1 billion, surpassing the expected $11.6 billion.

Amazon also provided guidance for the fourth quarter, which includes the crucial holiday period. The expected sales range is between $160 billion to $167 billion. Analysts had anticipated revenue of $166.6 billion. 

At the midpoint of this range, revenue would be $163.5 billion, reflecting a 9.6% growth from $149.2 billion in the previous year.

The 13% increase in revenue for the third quarter suggests an acceleration in the business's performance, following a challenging 2022 marked by high inflation and increasing interest rates.

Senator Markwayne Mullin bought $50,000 - $100,000 worth of Amazon shares on September 13, when the stock closed at $144.85. Shares were seen trading below $130 apiece on Friday.