Amazon Doubles Q2 Net Income to $13.49 Billion on Strength of Amazon Web Services
Amazon doubled its net income in the second quarter of 2024, reporting $13.5 billion.
This was largely due to growth when it came to Amazon Web Services, or AWS. The North American segment sales for AWS were $90 billion, a 9% year-over-year increase. International segment sales also increased by 7% over the same time period, clocking in at $31.7 billion. When accounting for changes in foreign exchange rates, that year-over-year increase is closer to 10%. Total segment sales for the period were a reported $26.3 billion, a 19% increase compared to Amazon’s second quarter in 2023.
Amazon’s subscriptions segment also saw growth. That division includes annual and monthly fees associated with Amazon Prime memberships as well as digital video, audiobook, digital music, e-book and other non-AWS subscription services. Altogether, net sales for this segment came in at $10.87 billion, a 10% increase compared to the second quarter of 2023.
The company reported its results after the bell on Thursday. As of Wednesday’s close, the Amazon’s stock price was up 23% this year.
Here are the top-line results:
Net income: $13.49 billion, up 99% from $7.7 billion a year ago.
Earnings per share: $1.26 per share, compared to $1.05 expected by analysts surveyed by Zacks Investment Research.
Revenue: $148 billion, up from $134.4 billion last year, compared to $148.6 billion expected by analysts surveyed by Zacks Investment Research.
“We’re continuing to make progress on a number of dimensions, but perhaps none more so than the continued reacceleration in AWS growth,” Andy Jassy, president and CEO of Amazon said in the earnings letter for the company’s second quarter of 2024.
Jassy said that AWS continues to be a “top choice” as companies continue to modernize, move to the cloud and explore opportunities using Generative AI. Specifically, Jassy pointed to four AI tools as being beneficial to the growth of AWS: SageMaker, a cloud-based machine-learning platform that was designed for model builders; Bedrock, a tool that connects AWS users to foundation models from leading AI companies like Meta; Trainium, a machine-learning chip that is built for deep learning training and serves as a more affordable option for customers; and Q, Amazon’s GenAI assistant for developers.
AI has been a major influencing factor during this round of earnings. During its second quarter earnings report in July, Alphabet reported growth through Google’s implementation of AI Overview, which provides search users near-instant answers to their queries based on sources around the web. This consumer-facing use of AI has increased engagement from users 18 to 24 years old. The company also announced it would be launching new ways to incorporate AI into search, including the introduction of a VR lenses and new features for Gmail and to Google Photos.
As for Apple, the tech giant introduced Apple Intelligence during its third quarter of 2024. The upcoming personal intelligence system will put private generative AI models into the company’s iPhone, iPad and Mac products.
More to come …
The post Amazon Doubles Q2 Net Income to $13.49 Billion on Strength of Amazon Web Services appeared first on TheWrap.