Amazon.com Delivers Blowout Earnings in Q4 as Retail Growth Soars

Investing.com – Amazon (NASDAQ:) handily beat earnings expectations in the fourth quarter, led by strong performance in its core online retail business as the roll-out of its expedited shipping program bolstered growth in North America.

The stock soared nearly 12% in after-hours trading, pushing shares above $2,000.

Amazon announced earnings per share of $6.47 on revenue of $87.44 billion. Analysts polled by Investing.com anticipated EPS of $4.05 on revenue of $85.97B.

That compares to EPS of $6.04 on revenue of $72.38 billion in the same period a year before. Amazon.com (NASDAQ:) had reported EPS of $4.23 on revenue of $69.98 billion in the previous quarter.

Growth was led by strong performance in its North American retail business as the rollout of its one-day shipping program boosted sales.

“Today’s report is good enough to address all those concerns that have kept the Amazon’s shares under pressure over the past few months,” Investing.com analyst Haris Anwar said. “Higher spending on expediting shipments have paid off quite handsomely, with strong growth in the company’s e-commerce business. The other big push is coming from the high-margin AWS (cloud) business where Amazon is sustaining a high level of growth.”

“Strong performance for seller services and other services business also gave a boost to Amazon’s gross margin, which was recently under pressure by the escalating shipping costs,” Anwar said.

“In a nutshell, this report should be enough to help Amazon stock to break its sluggish cycle and end its underperformance when compared to other tech giants.”

Retail sales in North America rose 21% to $53.7 billion.

“Prime membership continues to get better for customers year after year. And customers are responding — more people joined Prime this quarter than ever before, and we now have over 150 million paid Prime members around the world,” said Jeff Bezos, Amazon founder and CEO. “We’ve made Prime delivery faster — the number of items delivered to U.S. customers with Prime’s free one-day and same-day delivery more than quadrupled this quarter compared to last year.”

Amazon Web Services (AWS), its cloud business, generated revenue of $9.95 billion, above estimates of $9.84 billion. The beat in cloud services comes despite concerns that competition from cloud rivals like Microsoft’s (NASDAQ:) Azure would dent AWS growth.

The company guided first-quarter earnings in a range of $69-to-$73 billion, matching analysts’ estimates of $71.59.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.