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Cloud growth helps Amazon to another earnings beat, and its stock jumps
- Amazon reported impressive Q3 2021 earnings and revenue with strong growth in its cloud and advertisement businesses leading the way.
- Revenue increased by 11% YoY to $158.88bn, beating the consensus estimate of $157.2bn.
- Amazon delivered an operating profit of $17.4 billion, up from $11.2 billion in the same period last year.
- Operating profit of Amazon Web Services Inc. (AWS) was $10.45bn, accounting for 60% of the company's total profit.
- AWS experienced sales acceleration of 19% in Q3 2021, compared to 12% YoY growth in the same quarter last year.
- Amazon is buying up chips and focusing on cost-cutting, enhancing efficiency to improve the bottom line
- Amazon's advertisement business is growing, and its sales rose 19% YoY to $14.3bn, showing the most encouraging growth out of all the industry rivals.
- Amazon CFO Brian Olsavsky said the bulk of the company's capex spending is going toward technology infrastructure.
- Amazon expects to spend $75bn in fiscal 2024, and even more in fiscal 2025, driven mainly by generative AI.
- Investors placed high bets on AWS, Alexa, and the advertisement business and increased Amazon's stock prices by 5% in after-hours trading.
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