AMZN: Amazon Stock Jumps 6% on Super Earnings Beat, 19% Growth in Cloud

Amazon crushed it — 50% rise in net income, 52% leap in earnings per share, 11% jump in revenue and 29% cloud growth.

• Amazon stock AMZN popped 6% in pre-market trading Friday following the company’s stronger-than-expected quarterly report. Amazon’s financials for the three months to September 30 showed robust growth in the cloud computing division — Amazon Web Services — where sales jumped 19% to $27.5 billion. AWS is Amazon’s cash cow, responsible for the bigger chunk of the profits. Total net income jumped 50% from last year to $15.3 billion.
• Overall revenue for the ecommerce heavyweight also posted double-digit growth with an 11% increase to $158.9 billion, beating expectations of $157.3 billion. Earnings per share, a key profitability metric, landed at $1.43, a super-beat of expectations of $1.14 a share, and 52% above last year’s 94 cents a share. With rising revenues come rising expenses — Amazon nearly doubled its capital expenditures to $22.6 billion, up from $12.5 billion from the year-ago quarter.
• A big portion of that, executive said during the earnings call, went to feed the AI beast. “The majority of this spend is to support the growing need for technology infrastructure. This primarily relates to AWS as we invest to support demand for our AI services.” Amazon CEO Andy Jassy said he plans to greenlight $75 billion in spending this year. “The faster we grow demand, the faster we have to invest capital in data centres and networking gear.”