Amazon tops Q4 sales estimates but cloud growth lags
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The news: Retail and tech giant Amazon beat expectations for its quarterly revenue on the back of a strong holiday shopping season but growth at its cloud computing business lagged estimates, sending its shares lower in after hours trading.
The numbers: The world's biggest cloud provider and online retailer reported revenue of USD187.8 billion ($299 billion) in the fourth quarter, topping analyst estimates of USD187.3 billion. Net income nearly doubled to USD20 billion from USD10.6 billion a year ago, while earnings came in at USD1.86 a share, above expectations of $1.49 a share.
However, sales at its cloud computing services unit Amazon Web Services (AWS) increased 19% to USD28.79 billion, falling short of analyst estimates of USD28.87 billion.
Amazon shares fell nearly 3% in after-hours trading in New York.
The context: Amazon joined smaller cloud providers Microsoft and Google in reporting weak cloud services numbers, which comes as investors grow impatient with Big Tech’s multi-billion dollar capital spending.
Still, Amazon’s retail business helped offset the cloud weakness, with the company reporting online sales growth of 7% in the December quarter, while advertising sales rose 18%.
The company forecast operating profit of USD14 billion to USD18 billion for the first quarter of 2025, missing analyst estimates for USD18.35 billion.
The sources: Amazon media release, Reuters
