But revenue missed the mark.
For years, Amazon’s profits were either tiny or nonexistent. That seems to be changing.
For the third quarter in a row, the e-commerce titan reported a profit of over $1 billion, again blowing analysts’ estimates out of the water.
Earnings in the second quarter hit $2.5 billion, or $5.07 a share, up from $197 million a year earlier. Analysts were expecting $2.50 a share, according to Yahoo Finance.
Despite the rosy profit number, revenue was way up but narrowly missed estimates. Sales rose 39 percent to $52.9 billion, versus the $53.3 billion analysts predicted. Wall Street seemed to shrug off the sales miss and pushed Amazon’s stock up 2 percent after hours.
The earnings report comes as Amazon has edged closer to becoming one of the first US companies in history to hit a market value of $1 trillion. It’s march toward that milestone highlights how Amazon has become a leader in cloud computing and the dominant player in US e-commerce, taking in 50 percent of all online sales in the country, according to eMarketer.
The number also points to CEO and founder Jeff Bezos’ now staggering wealth; he owns about 16 percent of Amazon, making him the wealthiest person in the world. His personal wealth is now $154 billion, more than the gross domestic product of Hungary.
While Amazon and Bezos are enjoying a massive upswing of good fortune, the fate of fellow tech giant Facebook shows how quickly things can change in the tech industry. Facebook on Wednesday reported weak revenue in its latest quarter and warned of continued financial softness, resulting in the social network’s shares plummeting by 19 percent Thursday.
As is often the case in Amazon’s quarterly reports, its cloud-computing unit, Amazon Web Services, powered a big chunk of the profit despite taking in much less revenue than the retail business. AWS profit hit $1.6 billion, up from $916 million.
The North American retail business also posted a healthy jump in earnings, from $436 million $1.8 billion. International retail posted another loss.
During its last quarterly report, Amazon said it will raise the annual price of its Prime membership in the US by $20, to $119. That change took effect for new members on May 11 and renewals on June 16. With the latest quarter ending on June 30, the impact — if any — from the Prime price hike wasn’t apparent in the new numbers.
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