Big Tech is killing it in the first quarter. On April 29, Amazon delivered stunning results, perhaps beyond the most optimistic expectations.
The company recorded impressive revenues of $ 108.5 billion and EPS of $ 15.79 which largely beat the consensus of $ 9.64 and more than tripled from one year to the next. Amazon stocks ($ AMZN) ended the day slightly higher during the regular session and up + 3% in after-hours trading.
Below are two takeaways from the earnings day that summarize the company’s performance and after-hours share price developments.
# 1. AWS stimulates the uptrend
AWS’s strength was probably the highlight, with a 32% growth rate very easily beating the consensus by a good 10 percentage points, plus solid margins of over 30%. The rate of revenue increase picked up a bit sequentially, which must have come as a surprise to most Amazon analysts and investors.
This is probably the main reason why Amazon stocks have climbed after hours, even after stocks have climbed 13% in the last month alone. The market tends to pay remarkably close attention to the growth rate of cloud business.
Take a look at the table below and write down the exceptional growth numbers for the first quarter in column 2:
# 2.Every quarter is a public holiday
Amazon’s e-commerce is on fire. Online stores largely maintained their momentum in the last quarter, climbing 41% year over year. Physical stores, on the other hand, still appear to be heavily impacted by the pandemic, down -16%.
Third-party businesses remain strong – this is essentially where the highest growth rates are found, in e-commerce in North America. It should be noted that the operating margins of the International and North America segments this time reached a peak of six quarters.
The combination of (1) a recovering economy, particularly in the United States, and (2) the COVID-19 pandemic which has caused a shift in shopping habits is favoring online retailers. Among them, Amazon is a clear winner, perhaps the best player.
As a result, the first quarter felt like another vacation period for the Seattle-based giant, with total quarterly revenues only topping $ 100 billion for the second time.
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