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Packages from Amazon.com Inc. are stacked on the sidewalk in New York, USA, on Thursday, June 11, 2020.
Jeenah Moon / Bloomberg
With a big boost from accelerated e-commerce adoption amid the Covid-19 pandemic, Amazon.
com released second-quarter financial results that dramatically exceeded Wall Street estimates and the company’s own guidance.
For the quarter, Amazon (ticker: AMZN) reported sales of $ 88.9 billion, well ahead of the company’s targeting range of $ 75 billion to $ 81 billion. Earnings were $ 5.2 billion, or $ 10.30 a share, about five times Wall Street analyst consensus at $ 2.09 a share. Operating income was $ 5.8 billion, well above the company’s expectations for an even quarter.
Amazon shares rose 4.9% in after-hours trading, adding to the 65% gain in shares to date.
The operating cash flow of the last 12 months was $ 51.2 billion, 42% more than in the same period of the previous year.
Amazon said product sales in the June quarter were $ 50.2 million, an increase of 40.2%. Service sales were $ 38.7 billion, an increase of 38.7%. Sales in North America were $ 55.4 billion, 43.4% more. International sales were $ 22.7 billion, an increase of 38.4%.
If there was any weak point during the quarter, it came from the cloud. Amazon Web Services had sales of $ 10.8 billion, a 28.9% increase, slightly below Street’s estimates and a likely source of discussion about the earnings call and in post-earnings analyst notes. AWS failure follows a similar slight disappointment in Microsoft’s June quarter growth‘s
Azure Public Cloud.
“This was another very unusual quarter, and I couldn’t be more proud and appreciative of our employees around the world,” said Amazon CEO Jeff Bezos in a statement. “As expected, we spent over $ 4 billion on incremental Covid-19 related costs in the quarter to help keep employees safe and deliver products to customers at this time of high demand …
“We have created more than 175,000 new jobs since March and are in the process of taking 125,000 of these employees to regular full-time positions. And third-party sales grew again faster this quarter than Amazon’s third-party sales. “
The company said it spent more than $ 9 billion on capital projects during the quarter, on compliance, transportation and AWS.
For the third quarter, Amazon projects sales of $ 87 billion to $ 93 billion, an increase of between 24% and 33%, and an operating income of between $ 2 billion and $ 5 billion. Wall Street has been waiting for $ 86.3 billion in sales.
Write to Eric J. Savitz at [email protected]
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