Amazon has revealed its biggest profit since the lockdown online shopping boom after a leap in sales.
The internet retail giant said revenues in the third quarter of the year grew by 13pc to $143.1bn (£118bn), while profits more than trebled, to $9.9bn.
The figures marked a revival for Amazon, which has suffered from slowing growth and made heavy cost cuts in the last year as the end of Covid-19 lockdowns prompted more people to spend money offline.
The quarterly profit was its strongest since the end of 2021, when fears about the Omicron variant meant many people stayed at home.
Amazon said spending at its online stores had grown by 6pc. Advertising revenue – from sellers paying to appear in Amazon’s search results – was up 25pc, while its giant cloud computing division grew sales by 12pc. Sales of subscriptions, largely its Prime next-day delivery service, rose 13pc to $10.2bn.
Amazon has faced questions about its growth under Andy Jassy, who took charge of the company from founder Jeff Bezos two years ago.
Sales have slowed as surging inflation hits consumers’ pockets.
The company has also faced growing pressure from cut-price Chinese retailers Shein and Temu, which ship products directly from China and aim to dramatically undercut Amazon.
Amazon has cut thousands of jobs and admitted that it overextended itself during the pandemic, when it spent heavily on opening new warehouses.
Mr Jassy said the results of a recent reorganisation of its US delivery network were “exceeding our optimistic expectations, and perhaps most importantly, putting us on pace to deliver the fastest delivery speeds for Prime customers in our 29-year history.”
Many of Mr Jassy’s cuts have hit unprofitable technology projects such as the Alexa voice assistant and till-free “Amazon Go” stores, which use cameras and artificial intelligence to identify what shoppers are picking off shelves.
The company has been seen as slow to capitalise on the artificial intelligence boom, but recently invested $4bn in Anthropic, a rival to ChatGPT-maker OpenAI.
Amazon’s profits were somewhat boosted by its stake in the electric car maker Rivian, which has increased in value in recent months.
Shares rose by around 3pc in after-hours trading.
Amazon recently announced it would start drone deliveries in the UK next year, more than a decade after Mr Bezos first unveiled plans to deliver packages to houses by air. It has not said where the first deliveries will take place.
The Big Tech company was last week sued by America’s Federal Trade Commission, which has claimed the company is monopolising online shopping, keeping prices high for consumers and ensuring that sellers lose out. Amazon has vowed to fight the regulator.
Post Disclaimer
The following content has been published by Stockmark.IT. All information utilised in the creation of this communication has been gathered from publicly available sources that we consider reliable. Nevertheless, we cannot guarantee the accuracy or completeness of this communication.
This communication is intended solely for informational purposes and should not be construed as an offer, recommendation, solicitation, inducement, or invitation by or on behalf of the Company or any affiliates to engage in any investment activities. The opinions and views expressed by the authors are their own and do not necessarily reflect those of the Company, its affiliates, or any other third party.
The services and products mentioned in this communication may not be suitable for all recipients, by continuing to read this website and its content you agree to the terms of this disclaimer.