Amazon.com Inc.’s dwarfed estimates for quarterly profit on Thursday and forecast operating income above Wall Street’s expectations for the third quarter, as the company earned far more from its higher-margin cloud business.
The company forecast operating income of between $1.4 billion and $2.4 billion for the third quarter, beating analysts estimate of $843 million.
Revenue from Amazon Web Services (AWS), the company’s fast-growing cloud services business, surged about 49 percent to $6.11 billion, beating an average estimate of $6 billion, according Thomson Reuters I/B/E/S.
Operating income for AWS rose 80 percent to $1.64 billion, powering profits for the entire company which were double expectations of $2.50 per share.
Amazon’s shares (AMZN) rose 4.3 percent in early after-hours trading. They had already risen 60 percent in 2018 so far.
Net sales in North America, its biggest market, jumped 43.8 percent to $32.17 billion in the reported quarter.
The Seattle-based company said total net sales rose 39 percent to $52.89 billion, missing the average analyst estimate of $53.40 billion.
Total operating expenses surged 33.7 percent to $49.90 billion as the company invested heavily in its Prime program, creating original video content and building its warehouse and delivery infrastructure.
Net income rose to $2.53 billion, or $5.07 per share, in the second quarter ended June 30 from $197 million, or 40 cents per share, a year earlier.
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