Amazon shares go wild after earnings beat

Jeff bezos

Amazon reported its third-quarter earnings Thursday.

The results are an overall beat. Amazon shares are up almost 11% in after-hours trading, and nearly double where it was last year.

Here are the most important numbers:

  • Revenue: $US25.4 billion vs. $US24.9 billion expected
  • EPS: $US0.17 per share vs. $US0.13 loss per share expected

That’s two consecutive quarters with a profit, a rare feat for Amazon, a company known for growing its business at a loss. This quarter, Amazon had net income of $US79 million, after seeing net income of $US92 million in the previous quarter.

The $US25.4 billion quarterly revenue is up 23% from the same quarter of last year. Net income came in at $US79 million this quarter. It reported an operating cash flow of $US9.8 billion, up 72% from third-quarter of 2014.

It gave next-quarter guidance in the range of $US33.50 billion and $US36.75 billion, or up between 14% and 25% compared with fourth-quarter 2014.

Amazon held re:Invent, its annual conference for Amazon Web Services, the cloud-computing segment that’s generated $US1.8 billion in sales in the second quarter. In the third quarter, AWS reported $US2.1 billion in revenue, with a healthy margin of around 25%. AWS revenue grew 78% on a year-over-year basis.

AWS had an operating income of $US521 million this quarter. That’s almost the same as the $US528 million operating income Amazon generated in its North American retail business this quarter, showing how important AWS has become to its overall business.

AWS operating margin

Amazon also introduced Prime Day, a full day of sales that offered Black Friday-type of deals, for the first time last quarter. Investors will be interested in seeing how it affected its overall sales and Prime memberships. Amazon has never disclosed the size of its Prime subscribers before.

During a call with reporters shortly after the earnings, Amazon CFO Brian Olsavsky said Prime Day contributed 2% to Amazon’s revenue growth globally, which resulted in adding more new Prime members than any other day in company history. He said Prime Day will continue to be a part of Amazon in the future and become a bigger part of the company, but declined to share any further info.

Disclosure: Jeff Bezos is an investor in Business Insider through hispersonal investment company Bezos Expeditions.

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