Amazon Announces Quarterly earnings – Stocks Skyrocket ?>

Amazon Announces Quarterly earnings – Stocks Skyrocket

Amazon announced it earnings for the first quarter of 2016 this Thursday. Commonly known for its investment in growth at a loss, Amazon surprisingly reported a net income of $513 million in the first quarter of this year. This is in fact the largest profit any company has ever earned. The company has recorded a massive jump from the $57 million loss reported last year.

AWS, the cloud business is currently the most profitable investment for Amazon. It has driven the net growth of the company with a 64% annual revenue increase recorded this quarter.

Here are the most significant figures;

· Operating Cash Flow recorded at $11.3 billion, a 44% increase from last year’s $7.8million.

· Web Services revenue reported as $2.57 billion, 40.04 billion above the estimated $2.53 billion. This is a steady annual increase of 64%

· Profit per share was $1.07, up $0.49 over the estimated $0.58

· General revenue of $29.1 billion, $1.11villion above the estimated $27.99; 28% annual increase.

As a build up to the current earnings, Amazon gave a revenue direction of between $28 and $30.5 billion for the next quarter of the year. This is generally seen to be higher than the $28.3 billion street estimates. The company’s operating income is likely to vary between $375 and $975 million in the second quarter.

According to Amazon CEO Jeff Bezos, sales for Fire Tablets increased by double compared to 2015. He was keen to note that that Amazon is under pressure to meet the high demand for Echo.

The greatest concern for Amazon investors at the end of this quarter is the amplified shipping costs. This quarter has recorded the highest shipping costs at$3.3billion. This is a whopping 42% annual increment compared to the same quarter last year.

Even as the shipping costs become a great concern to investors, it is a relief to report that Amazon is developing its own logistics network in order to shrink the shipping cost by managing its own delivery services.

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