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Amazon Corporation presented financial indicators for the IV quarter, which turned out to be better than analysts expected. Its revenue for the specified time period increased by 14% to $170 billion, which is higher than analysts' expectations, which said $166,2 billion. In general, the net profit of the corporation amounted to $10,6 billion. A year earlier, this figure reached only $300 million, cauvocapital.com experts report.
Over the past year, Amazon executives have been trying to rein in spending. From the winter months of 2022 to the middle of last year, the company fired more than 27 thousand people, canceled a number of rates created as an experiment. The company also reduced costs in other segments, such as Twitch, Prime Video and MGM Studios.
According to Amazon's financial director, they intend to continue to use a "cautious" approach to new investments. At the same time, he believes that there is no need to wait for a period of strong efficiency in 2024. According to the experts of Cauvo Capital, whose opinions are based on a deep analysis of reporting documentation, the company's revenues increased, in part because the IV quarter is traditionally the busiest for it.
Amazon active development of the cloud division continues
The AWS division consistently demonstrates high results, receiving $24,2 billion in revenue (a 13% year-over-year increase). It is important to note that this is an insignificant quarter-on-quarter improvement (in the three previous months, the increase reached 12%). In addition, the result turned out to be worse than last year, when the increase reached 20%.
The corporation notes that AWS has developed its business quite quickly over the past year, even taking into account the economic problems due to which companies have tried to reduce the costs of cloud computing. At the same time, Amazon claims that the scale of measures taken to optimize costs is being reduced. In addition, there is a need to solve new work tasks at enterprises. In particular, you can see a lot of interest in AWS services related to generative AI.
The market is very interested in the Bedrock service. According to experts, the greatest interest in this service is due to its use within Amazon in segments of automated code customization. This approach makes it possible to increase the speed of introduction of new products and reduce the costs of these operations.
Amazon predicts the maintenance of positive sales dynamics in the current quarter
In addition, the company is taking measures to maximize the coverage of generative AI. In particular, she introduced the new assistant Rufus. Now it is undergoing testing in the United States. The corporation claims that its main task is to respond to requests for various products that are sold through Amazon services. The AI model used by Rufus for work was trained on the information and product catalog of the corporation, as well as on consumer reviews.
Another serious source of income for Amazon is the advertising segment. In it, the increase in sales reached 27% year-on-year, up to $14,7 billion. In January, the corporation introduced advertising to Prime Video. Analysts Cauvo Capital they assume that this step will provide the giant with significant income.
