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Amazon. com reported strong fourth- quarter results on Thursday, driven by strong growth in both its AWS cloud unit and its growing advertising business.
The results could be a relief to some investors given the weak numbers on Wednesday from Facebook-parent Meta Platforms.
Amazon (ticker AMZN) shares were jumping10.7 to$ in premarket trading Friday. Indeed with the premarket rally, the stock remains lower for the time to date.
Amazon also said it's adding the price of its Amazon Prime class for the first time since 2018. Amazon will now charge$14.99 a month, over from$12.99, or$ 139 on an periodic base, over from$ 119. The increase will be effective onFeb. 18 for new members, and starting March 25 for current members on the date of their renewal.
For the quarter, Amazon posted deals of$137.4 billion, over 9, and about in line with Wall Street estimates, and harmonious with the company’s read range of$ 130 billion to$ 140 billion. The company said the bottommost quarter total was trimmed by about$1.3 billion due to inimical foreign exchange rates.
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Earnings in the quarter soared to$14.3 billion, or$27.75 a share, from$7.2 billion, or$14.09 a share, a time ahead. Bottommost quarter earnings include anon-cash$11.8 billionpre- duty gain on the company’s stake in the truck maker Rivian Automotive (RIVN). Operating income was$3.5 billion, above the company’s guidance range of break- indeed to$ 3 billion.
Results in the company’s core online stores business was soft, though perhaps not as bad as bears on Wall Street had stressed. Online stores deals were$66.1 billion, down 1 from a time agone, and about$2.5 billion below Wall Street estimates. The same pattern was true for third- party dealer services — deals were$30.3 billion, over 11, but a miss relative to the Road agreement at$ 31 billion. Deals at physical stores were$4.7 billion, over 17.
One major neutralize came from Amazon Web Services — the pall unit had profit of$17.8 billion, over 40 from a time agone, accelerating slightly from 39 growth in the December quarter, and ahead of the Wall Street agreement cast at$17.4 billion. Meanwhile, Amazon also had a strong quarter in the advertising business, with profit of$9.7 billion, up 32, and ahead of the Road agreement cast at$9.4 billion. Subscription services profit were$8.1 billion, over 15, but a little shy of agreement at$8.4 billion.
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The strong results in both AWS and advertising show the growing power of the company’s diversification drive — and they suggest that the issues that were apparent in the December quarter earnings report from Facebook-parent Meta Platforms (FB) are not inevitably suggestive of a broader issue with online advertising. In fact, there is validation that Facebook could be losing some request share to both Google-parent ABC (GOOGL) and to Amazon.
Meanwhile, the strong AWS numbers vindicated the ongoing swell in marketable computing toward the pall — note that both Microsoft (MSFT) and ABC (GOOGL) reported strong growth for their pall-computing businesses in the quarter. Microsoft also projected that growth for its Azure pall business would accelerate in the March quarter.
In a statement, Amazon CEO Andy Jassy said that the company “ as anticipated” saw advanced costs over the leaves, driven by labor force crunches and inflationary pressures, adding that “ these issues persisted into the first quarter” due to the Omicron variant of Covid-19. “ Despite these short- term challenges, we continue to feel auspicious and agitated about the business as we crop from the epidemic,” he said.
For the March quarter, Amazon is projecting deals of$ 112 billion to$ 117 billion, over between 3 and 8. The company noted that inimical foreign exchange rates would reduce growth by 150 base points. The company sees operating income in the quarter of between$ 3 billion and$ 6 billion, including$ 1 billion from reduced deprecation expenditure due to an increase in the estimated useful lives of waitpersons and networking outfit.
Amazon’s selloff on Thursday of nearly 8 was started by weak signals on the state of the consumere-commerce request on Wednesday from both digital payments provider PayPal Goods (PYPL) and from Meta Platforms.
In reporting results Wednesday, Facebook parent Meta said, among other goods, that it's “ hearing from advertisers that macroeconomic challenges like cost inflation and force- chain disruptions are impacting advertiser budgets,” which would also suggest some trouble toe-commerce demand.