Amazon sales grow and profits soar ahead of holiday season

27 Oct 2023

Image: © gguy/

CEO Andy Jassy said that revenue from ads and overall net income grew significantly in the third quarter.

Amazon revenue has grown 13pc and profits have more than tripled compared to the same period last year in its latest earnings report, as the e-commerce giant prepares for the busy Christmas season.

The company’s revenue in the third quarter of this year stood at $143.1bn, ahead of the expected $141.4bn, leading to a rise in stock prices in after-hours trading.

Meanwhile, net income surged to $9.9bn in the latest quarter, up from $2.9bn a year ago. This includes a pre-tax valuation gain of $1.2bn from Amazon’s investment in EV start-up Rivian Automotive.

“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 [Amazon Web Services] growth continued to stabilise, our advertising revenue grew robustly, and overall operating income and free cash flow rose significantly,” said CEO Andy Jassy.

Revenue at its AWS cloud unit grew 12pc over last year to $23.1bn, slightly underwhelming analysts who expected a higher rate of growth.

“The AWS team continues to innovate and deliver at a rapid clip, particularly in generative AI, where the combination of our custom AI chips, Amazon Bedrock being the easiest and most flexible way to build and deploy generative AI applications,” Jassy said.

Amazon said it expects sales in the upcoming quarter, which includes the online shopping spree that comes with the Christmas holiday period, to be between $160bn and $167bn. Analysts expecte revenue of more than $166bn. Last year’s fourth-quarter sales stood at $149.2bn.

Last year Amazon had its first quarterly loss since 2015. This was attributed to rising operating costs and the company’s common stock investment in Rivian.

Amazon has been making efforts to cut costs and improve its efficiency this year. In March, the tech giant revealed plans to let go of 9,000 employees on top of the 18,000 it laid off in January.

“Between AWS re:Invent and our 29th holiday shopping season, this is a particularly action-packed time of year at Amazon, and we’re excited for what’s to come,” Jassy said in the latest earnings statement.

Last month, Amazon revealed plans to invest up to $4bn in Anthropic, the artificial intelligence start-up behind ChatGPT competitor Claude, as it looks to take on Microsoft and Google in the AI race.

This week, Amazon announced that AWS is working on a new European cloud service to keep sensitive data on the continent and meet EU data security requirements.

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Vish Gain is a journalist with Silicon Republic