What you need to know
- Amazon reports a third quarter with earnings that have beaten analyst expectations, sitting at $143.1 billion in revenue (13% increase YoY).
- Andy Jassy, Amazon's CEO, continued to praise its AWS as it generated $23.1 billion, a 12% increase YoY.
- Amazon's Prime Day performance is expected to be a talking point in Q4 2023 where the company expects to gain around $167.0 billion in net income.
Amazon reported its financial earnings for Q3 2023, and the online retailer is ending things on a better note than analysts predicted for it.
The company states in Q3, it generated $143.1 billion in revenue. This marks a 13% year-over-year (YoY) increase compared to 2022. On the operating side of the business, the company reported an earned income of $11.2 billion, a sharp increase over $2.1 billion earned in Q3 2022.
Andy Jassy, CEO of Amazon, stated, "We had a strong third quarter as our cost to serve and speed of delivery in our Stores business took another step forward, our AWS growth continued to stabilize, our Advertising revenue grew robustly, and overall operating income and free cash flow rose significantly."
It's AWS (Amazon Web Services) in Q3 generated $23.1 billion, a 12% YoY increase. The same segment reported $7 billion in operating profits, up from $2.5 billion last year. Amazon's web service was an area that saw great positivity for the retailer in Q2 and continues to prove successful at the end of the third.
This cloud-based service is also performing much better than its competitor, Google Cloud, which reported $8.4 billion during Alphabet's Q3 2023 conference call.
Amazon didn’t report what it earned from its most recent Prime Day earnings as the event just wrapped up earlier this month. It is likely the company will report it in Q4. Amazon added that across the 19 countries it held the event, customers were able to save "more than $1 billion on millions of deals."
As analysts watch for the company's second Prime Day results in Q4, Amazon reported its guidance for Q4, stating its net sales are expected to grow by up to 12%, potentially landing around $167.0 billion.
Though Amazon has reported a Q3 that has gone against what many in the industry were expecting, it's not like this has come without cost. The online retailer went on quite a large layoff spree earlier this year, with 18,000 losing their jobs in January to 9,000 more getting let go in March. Amazon isn't the only large tech company to make moves like this. However, it'll be worth monitoring the brand as we move into the final quarter of 2023.
