Amazon shares rise after reporting record quarterly profit

Amazon shares surged in out-of-hours trade after the tech giant published a record Q2 profit.

Amazon shares rise after reporting record quarterly profit

Amazon shares ended the regular US trading session in the red Thursday but perked up after-hours, once the tech behemoth released its second quarter earnings report. In it, the company achieved a record profit of $2.53 billion, buoyed by online sales and the performance of its AWS arm.

Amazon shares ended the regular US Thursday trading session 2.98% lower at $1,808. After the closing bell and the publication of Amazon’s earnings, the stock reversed that drop to climb over 3%.

Amazon earnings details

That $2.5 billion second quarter net profit dwarfed the €197 million profit achieved the same period a year earlier.

That surge in profits came amid a strong performance for its AWS cloud arm. Sales climbed to $6.1 billion, while net income there surged to $1.6 billion, up from $916 million a year earlier.

Meanwhile, total sales at Amazon.com hit $52.9 billion in the three months to the end of June, a 39% increase from $38 billion a year earlier.

“It was a strong quarter,” said Amazon’s CFO, Brian Olsavsky, in the earnings call. “We had – what I attribute it to is continued strength in our – some of our most profitable areas.”

Olsavsky specified: “AWS had its third consecutive quarter of accelerating growth…. advertising also had strong growth. Elsewhere we saw probably better than expected efficiencies in operations, our infrastructure costs, and generally all of our fixed costs.”

Spending slows

Also adding to the yet again impressive financial performance of Bezos’ tech giant, was a slowdown in spending.

That pace of employee growth slowed and while the firm continues to add locations, services and fulfilment centres around the world, previous infrastructure investment means that there were a number of cost efficiencies during Q2.

Having said that, Amazon’s CFO said that it wasn’t certain that those efficiencies would remain in place, going forward.

“We can drive more efficiently and we can sometimes bank the efficiencies of prior investments that we've made in other periods. So it will fluctuate quarter-to-quarter,” Olsavsky said.

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