Amazon.com Inc on Thursday posted strong results across its older and newer businesses, as global Web retail sales and cloud services topped analysts’ forecasts and the world’s largest online merchant predicted that revenue would outpace expectations in the current quarter as well.
The Seattle-based company is riding a wave of retail sales moving to the Internet, and its Netflix-like video streaming is bringing new customers to its subscription Prime service, which in turn drives customers to spend more on Amazon.
The cloud unit, Amazon Web Services, is the company’s fastest-growing business and is regarded by analysts as the next driver of growth for the company.
“They crushed estimates,” Wedbush Securities analyst Michael Pachter said, as Amazon shares rose 2 percent in after-hours trade on Thursday.
Forbes calculated this week that chief executive Jeff Bezos had surpassed Warren Buffett to become the world’s third-richest person.
The expansion in so many areas requires substantial investment, though, and shares initially dipped after the earnings report. The company forecast relatively low operating income for the current quarter of US$50 million to US$650 million.
It earned US$857 million in the second quarter, or US$1.78 per share, compared with analysts’ average estimate of US$1.11 per share, according to Thomson Reuters.
“It was the largest June quarter profit in the company’s history, but we’re back to guiding barely any profitability,” BGC Partners analyst Colin Gillis said of the September quarter guidance.
Lower September-quarter income is routine for Amazon, as it ramps up for the end-of-year holiday shopping season, chief financial officer Brian Olsavsky said.
“We’re adding warehouses. We’re adding workers,” he said, adding 18 new fulfillment centers for the third quarter, compared with six centers in the same period last year.
Amazon’s work force expanded by 47 percent in the second quarter year-over-year, including part-time employees.
Costs will also rise as Amazon doubles spending on video content in the second half of the year versus the same period a year ago, aiming to attract consumers to its Prime subscription packages, Olsavsky said.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day