Seattle, Washington – Amazon’s first-quarter earnings have surpassed Wall Street expectations, driving the retail giant’s shares up by as much as 5% in after-hours trading. With a significant boost from its cloud computing segment, Amazon continues to impress investors amidst a wave of strong results from Big Tech companies.
The company revealed that its Amazon Web Services (AWS) business is on track to achieve $100 billion in annual revenue, showcasing its dominance in the industry. In the fiscal first quarter, Amazon reported notable metrics, including net sales of $143.3 billion, adjusted earnings per share of $0.98, AWS revenue of $25 billion, and advertising revenue of $11.8 billion.
CFO Brian Olsavsky discussed Amazon’s plans for increased capital expenditures (capex) this year, driven by higher infrastructure costs to support AWS growth, particularly in generative AI. The company’s quarter saw $14 billion in capex, with expectations for further increases in upcoming periods.
Following the impressive performance of Microsoft and Alphabet in the cloud computing sector, Amazon has also positioned itself as an AI leader, investing in AI startup Anthropic to strengthen its foothold in the market. The use of AI tools requires extensive data and processing power, highlighting the importance of cloud providers like Amazon in providing essential infrastructure.
Amazon’s stock, which joined the Dow Jones Industrial Average in February, has experienced a 20% increase this year, showcasing the market’s confidence in the company’s future growth prospects. The company’s strategic focus on cloud computing and AI innovation continues to drive its success in the competitive tech landscape.
As Amazon and its peers navigate the evolving tech landscape, the competition for market share and the development of new consumer services intensifies. With its strong performance in the first quarter and ongoing investments in key areas like cloud computing and AI, Amazon remains a significant player in driving innovation and growth in the industry.