Amazon soars after revenue, operating income top expectations
HJBC
Amazon (NASDAQ:AMZN) shot up in after-hours trading after reporting operating income above expectations for Q1 and setting strong guidance for Q2.
The Seattle-based e-commerce giant reported total revenue in North America in Q1 was up 11% to $76.88B vs. $75.3B consensus, while international revenue was $29.1B vs. $27.7B consensus.
The cloud business was strong again as AWS revenue came in at $21.35B vs. $21.0B consensus, up 16% from a year ago.
Operating income was reported at $4.8B in comparison to the consensus mark of $3.0B and the company's guidance range of $0B to $4B. Operating margin was 3.7% of sales to mark the highest level in more than a year. Net income was $3.2B, inclusive of a pre-tax valuation loss of $0.5B included in non-operating expense from the common stock investment in Rivian Automotive (RIVN).
Free cash flow improved to an outflow of $3.3B for the trailing twelve months, compared to an outflow of $18.6B for the trailing twelve months a year ago.
CEO Andy Jassy: "Our Stores business is continuing to improve the cost to serve in our fulfillment network while increasing the speed with which we get products into the hands of customers (we expect to have our fastest Prime delivery speeds ever in 2023). Our Advertising business continues to deliver robust growth, largely due to our ongoing machine learning investments that help customers see relevant information when they engage with us, which in turn delivers unusually strong results for brands. And, while our AWS business navigates companies spending more cautiously in this macro environment, we continue to prioritize building long-term customer relationships both by helping customers save money and enabling them to more easily leverage technologies like Large Language Models and Generative AI."
Looking ahead, Amazon expects Q2 revenue of $127.0B to $133B vs. $130.1B consensus and operating income of $2.0B to $5.5B vs. $4.7B consensus.
The Amazon (AMZN) conference call is set for 5:30 p.m.
Shares of Amazon (AMZN) soared 11.30% in after-hours trading to land at $122.20 The e-commerce stock gained 4.61% during the regular session.
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