Global online marketplace Amazon has grown its net income 118 per cent during the first quarter of 2019, from US$1.6 billion to US$3.56 billion ($2.28 billion to $5.07 billion).
The three months to March 31 2019 also delivered operating income of US$4.4 billion ($6.27 billion), compared to US$1.9 billion ($2.7 billion) the year prior. These increases come off the back of a 17 per cent growth in sales to US$59.7 billion ($85.09 billion).
However, while the company grew its North American operating income over the period to US$2.28 billion ($3.25 billion), its international performance led to a US$90 million loss ($128.2 million) – though this can be positively compared to the same period last year, during which Amazon’s international business lost US$622 million ($886.5 million).
Research firm eMarketer estimates that Amazon holds almost half of the US e-commerce market, which is set to grow 20 per cent to US$282.5 billion ($402.6 billion).
EMarketer principal analyst Andrew Lipsman said the quarter was fuelled by the strength of Amazon’s cloud and advertising business, which continues to inflate the company’s margins.
“While AWS’s momentum continues unabated and is clearly the bigger driver of this profit story at the moment, the advertising flywheel now appears to be in full effect for Amazon and will only be a bigger part of the growth story over the near term,” Lipsman said.
Amazon’s AWS segment saw net sales grow 40 per cent year-on-year, from $5.4 billion to almost US$7.7 billion ($7.7 billion to $10.97 billion), contributing US$2.2 billion ($3.14 billion) in income to the business’ quarterly results.
Looking ahead, Amazon notes it expects second quarter sales to land between US$59.5 and US$63.5 billion ($84.8 and $90.5 billion) – an annual growth of between 13 and 20 per cent.
The business is leaving room for its operating income to decline over the period, however, expecting between US$2.6 and US$3.6 billion ($3.7 and $5.1 billion) – compared to the US$3 billion ($4.28 billion) earned in the second quarter of 2018.
