Amazon Net sales in the second quarter were US$113.1 billion, Rose 27%, but lower than Wall Street expectations, causing its stock price to fall 5% in after-hours trading.
The result is within the range of the company’s previously issued net sales guidance, that is, net sales between US$110 billion and US$116 billion. However, Wall Street analysts had previously expected Amazon’s overall net sales to be $115 billion, an average year-on-year increase of 29%.
Amazon is still able to exceed expectations with a profit of $7.8 billion or $15.12 per share. Analysts expect earnings per share of $12.22, higher than the $10.30 per share a year ago.
- Amazon’s online sales growth rate has ranged from 37% to 49% in the past year, and increased by 13% to $53.1 billion in the most recent quarter.
- Amazon Web Services, the company’s cloud division, increased its growth rate to 37%, with net sales of US$14.8 billion and operating income of US$4.2 billion.
- Amazon’s “other” category, including advertising revenue, grew to $7.9 billion in the second quarter, an increase of 87%.
- As of the end of June, the total number of full-time and part-time employees worldwide reached a new high of 1.335 million, an increase of 64,000 from the end of March.
Amazon’s guidance for the third quarter also seems to take into account the after-hours share price decline. The company said that it expects net sales to be between 106 billion and 112 billion U.S. dollars, an increase of 10% to 16%, and operating profit is between 2.5 billion and 6 billion U.S. dollars, lower than the 6.2 billion U.S. dollars in the third quarter.
The company’s chief financial officer, Brian Olsavsky, spoke about the slowdown in online sales during a conference call with reporters.
Around mid-May last year, the growth rate of this business jumped from approximately 20% to 21% before the pandemic to a range of 35% to 45%. So we started to increase year by year. This is why you will see some declines in growth rates. On the lap of May 15th, we saw a business growth of more than ten percent. This is basically a combination of the intensity of last year’s COVID and the additional mobility we have seen among customers, especially in the United States and Europe, where people go out more and do other things besides shopping.
The company’s press release marks Andy Jassy’s first profitable debut as Amazon CEO, citing a position he previously reserved for his former Amazon founder Jeff Bezos .
Jassy talked about the company’s consumer business and the important services provided by Amazon Web Services during the pandemic, and thanked the company’s employees, saying that he is “very happy to work with you because we invent and build for the future.”
related: In the industry-wide advertising sales boom of technology giants, Amazon’s advertising business is soaring