New York, Friday, October 31, 2024-Amazon in its Q3 Earnings yesterday reported higher-than-expected third-quarter profits and sales, boosted by strong retail growth, sending its shares up nearly 6% in after-hours trading.
Retail sales rose by 7% to $61.41 billion, and Amazon Web Services (AWS) reported a 19% revenue increase to $27.5 billion, its fastest growth in seven quarters.
The company forecasted continued strong holiday season results due to quicker delivery times and stocking lower-cost items, indicating resilience against economic uncertainty.
There was a rise in capital spending to develop artificial intelligence, forecasting a jump to $75 billion this year from $48.4 billion in 2023.
North America retail margins improved to 5.9%, while international operations saw a substantial rise to 3.6% from 0.9% last quarter.
Advertising revenue also grew 19% to $14.3 billion, aided by ads on Prime Video and in stores.
However, Amazon’s conservative holiday revenue forecast at a midpoint of $185 billion, slightly under the analyst consensus of $186.16 billion, suggested caution amidst consumer unpredictability.
Despite new measures, including job cuts and a five-day in-office mandate starting in January, Amazon remains a top market performer, with shares rising 23% this year, surpassing the S&P 500’s nearly 20% increase.
