Amazon Q2 Net Sales Rise By 10%

Amazon.com, Inc. (NASDAQ:AMZN) today announced financial results for its second quarter ended June 30, 2024.

• Net sales increased 10% to $148.0 billion in the second quarter, compared with $134.4 billion in second quarter 2023. Excluding the $1.0 billion unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 11% compared with second quarter 2023.
  • North America segment sales increased 9% year-over-year to $90.0 billion.
  • International segment sales increased 7% year-over-year to $31.7 billion, or increased 10% excluding changes in foreign exchange rates.
  • AWS segment sales increased 19% year-over-year to $26.3 billion.
    
    
• Operating income increased to $14.7 billion in the second quarter, compared with $7.7 billion in second quarter 2023.
  • North America segment operating income was $5.1 billion, compared with operating income of $3.2 billion in second quarter 2023.
  • International segment operating income was $0.3 billion, compared with an operating loss of $0.9 billion in second quarter 2023.
  • AWS segment operating income was $9.3 billion, compared with operating income of $5.4 billion in second quarter 2023.
    
    
• Net income increased to $13.5 billion in the second quarter, or $1.26 per diluted share, compared with $6.7 billion, or $0.65 per diluted share, in second quarter 2023.
  • Second quarter 2024 net income includes a pre-tax valuation gain of $0.4 billion included in non-operating income (expense) from the common stock investment in Rivian Automotive, Inc., compared to a pre-tax valuation gain of $0.2 billion from the investment in second quarter 2023.
    
    
• Operating cash flow increased 75% to $108.0 billion for the trailing twelve months, compared with $61.8 billion for the trailing twelve months ended June 30, 2023.
  
  
• Free cash flow increased to $53.0 billion for the trailing twelve months, compared with $7.9 billion for the trailing twelve months ended June 30, 2023.
  
  
• Free cash flow less principal repayments of finance leases and financing obligations increased to $49.6 billion for the trailing twelve months, compared with $1.9 billion for the trailing twelve months ended June 30, 2023.
  
  
• Free cash flow less equipment finance leases and principal repayments of all other finance leases and financing obligations increased to $51.4 billion for the trailing twelve months, compared with $6.7 billion for the trailing twelve months ended June 30, 2023.

“We’re continuing to make progress on a number of dimensions, but perhaps none more so than the continued reacceleration in AWS growth,” said Andy Jassy, Amazon President & CEO. “As companies continue to modernize their infrastructure and move to the cloud, while also leveraging new Generative AI opportunities, AWS continues to be customers’ top choice as we have much broader functionality, superior security and operational performance, a larger partner ecosystem, and AI capabilities like SageMaker for model builders, Bedrock for those leveraging frontier models, Trainium for those where the cost of compute for training and inference matters, and Q for those wanting the most capable GenAI assistant for not just coding, but also software development and business integration.”

Some other highlights since the company’s last earnings announcement include that Amazon:

• Held its 10th Prime Day, the biggest Prime Day shopping event yet.
• Delivered to Prime members at its fastest speeds ever in the first half of the year.
• Expanded selection, including brands like Aéropostale, Bumble and bumble, and Kiehl’s.
• Announced that U.S. Prime members can enjoy a Grubhub+ membership worth $120 a year.
• Launched multiple AI-powered features for consumers, including shopping assistant Rufus for all U.S. mobile customers, playlist generator Maestro for Amazon Music, and a new search experience for Fire TV.
• Launched Amazon’s Stores business in South Africa with same and next-day delivery.
• Expanded Amazon Pharmacy’s RxPass program, which now offers Prime members on Medicare unlimited consumption of 60 broadly-used prescription medications for just $5 a month.
• Released 19 films and series from Amazon MGM Studios, including:
  • Fallout , the second most watched Original title worldwide ever on Prime Video during its launch.
  • Season 4 of The Boys , reaching No. 1 on Prime Video in over 165 countries in its first two weeks.
  • The Idea of You , attracting ~50 million viewers in its first two weeks on Prime Video.
• Earned 62 Primetime Emmy Award nominations, including 17 for Fallout and 16 for Mr. and Mrs. Smith .
• Secured expansive streaming rights for the NBA for 11 seasons, starting in 2025-26.
• Became the exclusive home of Monday Night National Hockey League games in Canada.
• Launched Anthropic Claude 3.5 Sonnet, Meta Llama 3.1, and Mistral Large 2 models in Amazon Bedrock.
• Shared that companies like AXA, DoorDash, Nasdaq, Rocket Insurance, SAP, Thomson Reuters, Workday, WPP, and Zendesk announced new applications built on Bedrock.
• Delivered new AWS Graviton4-based compute instances, providing up to 30% better price-performance than the industry-leading AWS Graviton3 instances.
• Signed new AWS agreements with Commonwealth Bank of Australia, Databricks, Discover Financial Services, Eli Lilly and Company, Experian, GE HealthCare, NetApp, Scopely, ServiceNow, Shutterfly, and many others—as well as AI startups Perplexity, H Company, and Observea.
• Announced an AUD $2 billion strategic partnership with the Australian Government to provide a “Top Secret” AWS Cloud to enhance the nation’s defense and intelligence capabilities.
• Added Austin and Miami to where self-driving robotaxi Zoox is deploying its test fleet on public roads.
• Ranked No. 2 on LinkedIn’s Top Companies list and No. 1 in the technology sector.
• Announced that all electricity consumed by Amazon’s operations, including its data centers, was matched with 100% renewable energy in 2023.
• Replaced 95% of plastic air pillows in Amazon’s delivery packaging in North America with paper filler.
• Announced an additional $1.4 billion commitment to Amazon's Housing Equity Fund for affordable homes.

Financial Guidance

The following forward-looking statements reflect Amazon.com’s expectations as of August 1, 2024, and are subject to substantial uncertainty. Our results are inherently unpredictable and may be materially affected by many factors, such as fluctuations in foreign exchange rates, changes in global economic and geopolitical conditions and customer demand and spending (including the impact of recessionary fears), inflation, interest rates, regional labor market constraints, world events, the rate of growth of the internet, online commerce, cloud services, and new and emerging technologies, and the various factors detailed below.

Third Quarter 2024 Guidance

• Net sales are expected to be between $154.0 billion and $158.5 billion, or to grow between 8% and 11% compared with third quarter 2023. This guidance anticipates an unfavorable impact of approximately 90 basis points from foreign exchange rates.
• Operating income is expected to be between $11.5 billion and $15.0 billion, compared with $11.2 billion in third quarter 2023.
• This guidance assumes, among other things, that no additional business acquisitions, restructurings, or legal settlements are concluded.

Source : Amazon

Image : Kay Roxby - shutterstock - 361754777

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