Amazon shares surge on news of Q2 profits
Amazon shares surged by more than 18% in after-hours trading yesterday (23 July), on the back of the company’s announcement of profits and better-than-expected sales for the second quarter. The company surprised the market with a $92m profit for the second quarter (Q2) ended 30 June, compared to a $126m loss for the same period a year ago.
Net sales were up 20% to $23.18bn, compared with $19.34bn for Q2 2014. Operating income was $464m, compared to an operating loss of $15 million last year.
The value of Amazon shares, which had fallen 1.3% during the day, leapt 18.5% to $571.24 in after-hours trading on Wall Street.
Looking to explaining the results, Jeff Bezos, founder and CEO of Amazon, said: “The teams at Amazon have been working hard for customers.
“We unveiled Amazon Business, opened Amazon Mexico, launched Prime free same-day, rolled out our ninth Prime Now city, broke our Black Friday record with the first-ever Prime Day, received 11 Emmy nominations for Transparent, debuted six new kids pilots, brought Echo to general availability, introduced the Alexa Skills Kit and Alexa Voice Service, opened FBA Small and Light, continued to double down on our fastest growing geography — India, launched 350 significant AWS features and services so far this year (ahead of last year’s pace), introduced AWS Educate, and entered into agreements for new solar and wind farms — enough to exceed our 2016 goal of 40% renewable energy.”
Amazon now has a market value of more than $250 billion. Analysts say that this means it has surpassed Walmart, the world’s largest “brick-and-mortar” retailer, for the first time.
Amazon’s CFO Brian Olsavsky told reporters on a conference call that there does appear to be a correlation between the company’s initiatives for speeding up delivery, with same-day delivery services such as Prime Now, and increased spending from customers.
The Q2 figures were bolstered by strong results in the US, but the rest of the world was not quite so impressive.
Click here to access the full text of Amazon’s Q2 results statement.