Amazon's Q3 net sales jump 34 percent

Lucy Hill
October 28, 2017

Amazon's stock price soared to more than $1,000 per share in after-market trading on Thursday after the company reported higher-than-expected revenues and offered an optimistic projection for its next quarter, which includes the critical holiday season.

Revenues for the quarter were $43.7bn (£33.4bn), up from $32.7bn in Q3 2016.

Profit for the quarter was $256 million, up slightly from $252 million a year ago while revenue jumped 34 percent to $43.7 billion for the company which has grown from its online retail roots to cloud computing, streaming video, artificial intelligence and more. The recent acquisition of grocery store chain Whole Foods Market contributed $1.3 billion to this tally, having closed four weeks before the end of the reporting period. Management had guided for third-quarter operating income to be between a loss of $400 million and a gain of $300 million. Analysts had predicted just over $42 billion in revenue. Shares in Amazon on Thursday, slightly down at the close, bounced some 6% after hours with the decisive earnings beat.

Amazon Business Launches Business Prime Shipping; Grainger Responds
Amazon Business was launched in the U.S. in 2015 and was later introduced to countries like Germany and the United Kingdom. The majority of Grainger's USA customers do not pay freight, as freight costs are embedded in our contracts.


Impressively, Amazon has managed to increase the pace of growth from its online stores, where sales increased by 22% over the prior year. Looking ahead, we excited about the possibilities for the Whole Foods business and believe that over the medium to longer term Amazon will make some more radical changes that will deliver stronger results.

Amazon said that for the fourth quarter, it expects revenues in a range of $56 to $60.5 billion, representing growth of 28 to 38 percent compared with previous year. Operating income from e-commerce sales in North America was $112 million. Along with AWS, Business Prime Shipping gives Amazon another service offering for the growing B2B e-Commerce market. "Customers have purchased tens of millions of Alexa-enabled devices", he said.

As is typical for the retailing giant, it took the earnings report as an opportunity to spotlight achievements, including three new Echo devices, five new Alexa-enabled devices, teaching Alexa to distinguish between two voices, and improvements in its AWS division. Going into today's earnings report, Amazon shares had risen nearly 30% this year. The move is interesting, as I am sure there are not many people with Amazon Echo products who do not also have Prime. For the quarter, operating income was down by 40% to $347 million. Given Amazon's appetite for growth - even when it comes at the expense of near-term profitability - it seemed logical that Amazon might spend a significant sum integrating Whole Foods' operations into its business. Anders Bylund owns shares of Amazon.

Other reports by TheDailyFarc

Discuss This Article

FOLLOW OUR NEWSPAPER