4 Φεβρουαρίου 2022, 00:08

Amazon Stock Soars on Good Enough Earnings. Plus, the Price of Prime Is Going Up.

Amazon . com reported strong fourth-quarter results on Thursday, driven by strong growth in both jts AWS cloud unit and its growing advertising business.

The results could be a relief to some investors given the weak numbers on Wednesday from Facebook-parent Meta Platforms .

Amazon shares jumped 18% in after hours trading, more than reversing a nearly 8% decline in the day’s regular session. Even with the after hours rally, the stock is down slightly for the year to date.

Amazon also said it is increasing the price of its Amazon Prime membership for the first time since 2018. Amazon will now charge $14.99 a month, up from $12.99, or $139 on an annual basis, up from $119. The increased will be effective on Feb. 18. for new members, and starting March 25 for current members on the date of their renewal.

For the quarter, Amazon posted sales of $137.4 billion, up 9%, and about in line with Wall Street estimates, and consistent with the company’s forecasted range of $130 billion to $140 billion. The company said the latest quarter total was trimmed by about $1.3 billion due to unfavorable foreign exchange rates.

Profits in the quarter soared to $14.3 billion, or $27.75 a share, from $7.2 billion, or $14.09 a share, a year earlier. Latest quarter earnings include a non-cash $11.8 billion pre-tax gain on the company’s stake in the truck maker Rivian Automotive (RIVN).

Results in the company’s core online stores business was soft, though perhaps not as bad as bears on Wall Street had feared. Online stores sales were $66.1 billion, down 1% from a year ago, and about $2.5 billion below Wall Street estimates. The same pattern was true for third-party seller services—sales were $30.3 billion, up 11%, but a miss relative to the Street consensus at $31 billion. Sales at physical stores were $4.7 billion, up 17%.

One major offset came from Amazon Web Services—the cloud unit had revenue of $17.8 billion, up 40% from a year ago, accelerating slightly from 39% growth in the December quarter, and ahead of the Wall Street consensus forecast at $17.4 billion. Meanwhile, Amazon also had a strong quarter in the advertising business, with revenue of $9.7 billion, up 32%, and ahead of the Street consensus forecast at $9.4 billion. Subscription services revenue were $8.1 billion, up 15%, but a little shy of consensus at $8.4 billion.