Following the release of better-than-expected fourth-quarter results, Amazon, an online retailer and cloud computing giant, saw a spike in share prices late on Thursday. Strength in the company’s primary e-commerce sector, which saw a robust holiday selling season, and ongoing rise in ad income drove the results.
According to projections, the company’s Amazon Web Services division grew 13% during the quarter over the same period last year. Amazon reported $170 billion in total sales for the quarter, a 14% increase over the company’s projected range of $160 billion to $167 billion.
Earnings per share were $1, exceeding the Wall Street average estimate of 79 cents. Operating income exceeded the company’s projected range of $7 billion to $11 billion, coming in at $13.2 billion. Amazon Web Services reported $24.2 billion in revenue, up 13% and exactly in line with predictions from Wall Street.
Sales at online stores exceeded the Street consensus of $68.7 billion to $70.5 billion, an increase of 9%. Third-party seller services brought in $43.6 billion in revenue, 20% more than expected, and $42.1 billion over estimates.
The quarter’s advertising income increased by 27% to $14.7 billion, significantly more than the $14 billion Street consensus. $10.5 billion in subscription income was received, a 14% increase and somewhat more than the $10.3 billion Street estimate.
Amazon expects revenue in the first quarter of $138 billion to $143.5 billion, up 8% to 13%, and operating income of $8 billion to $12 billion. The consensus on Wall Street had predicted operating income of $8.8 billion and revenue of $142.3 billion. “This Q4 was a record-breaking holiday shopping season and closed out a robust 2023 for Amazon,” stated a statement from Andy Jassy, the CEO of Amazon.
“While we made meaningful revenue, operating income, and free cash flow progress, what we’re most pleased with is the continued invention and customer experience improvements across our businesses.” After hours trading saw a 7.5% increase in Amazon shares as a result of the article.