AWS soaring sales help boost Amazon's bottom line

Amazon's cloud services provide bulk of $1.6 billion net profit in first quarter of 2018

Amazon Web Services made up for 73% of the Seattle-based company's overall profit in the first quarter of 2018.

In Amazon's latest earnings for its 2018 first-quarter earnings, the company reported sales of $51 billion, up by nearly 43% year over year, and a net income of $1.6 billion.

In the first quarter of 2018 the company collected more than 550m a day in revenue from online retail and TV production.

But its cloud services outpaced Amazon's overall growth with $5.4 billion in net sales, up 49% from the $3.7 billion reported for the same time last year. Those numbers translated into a healthy operating income of $1.4 billion for AWS. 

Advertisement
Advertisement - Article continues below
Advertisement - Article continues below

AWS is still a relatively small part of Amazon's overall business, but it is highly profitable for the company, contributing the lion's share to the firm's profits for the quarter. This is likely to the ever-marching increase in companies moving to the cloud and adopting cloud-based services that tap into AWS' vast infrastructure. 

AWS remains the market leader in terms of revenue generating more than $20 billion annually. They have expanded their cloud services with infrastructure in France, China and London and they continue to develop AI technologies, most notably with Alexa. 

The results sent Amazon shares up to a new record high of 7% ($1,625) in the after-hours of trading, adding billions to the considerable fortune of its founder and CEO, Jeff Bezos. In the report, Bezos cited the seven-year head start AWS over its rivals.

"AWS had the unusual advantage of a seven-year head start before facing like-minded competition, and the team has never slowed down," he said. "As a result, the AWS services are by far the most evolved and most functionality-rich. AWS lets developers do more and be nimbler, and it continues to get even better every day." 

Picture: Shutterstock

Featured Resources

How inkjet can transform your business

Get more out of your business by investing in the right printing technology

Download now

Journey to a modern workplace with Office 365: which tools and when?

A guide to how Office 365 builds a modern workplace

Download now

Modernise and transform your sales organisation

Learn how a modernised sales process can drive your business

Download now

Your guide to managing cloud transformation risk

Realise the benefits. Mitigate the risks

Download now
Advertisement

Most Popular

Visit/mobile/28299/how-to-use-chromecast-without-wi-fi
Mobile

How to use Chromecast without Wi-Fi

5 Feb 2020
Visit/operating-systems/microsoft-windows/354789/microsoft-pulls-disastrous-windows-10-security-update
Microsoft Windows

Microsoft pulls disastrous Windows 10 security update

17 Feb 2020
Visit/operating-systems/27717/how-to-fix-a-stuck-windows-10-update
operating systems

How to fix a stuck Windows 10 update

12 Feb 2020
Visit/business/business-operations/354790/hp-shareholders-invited-to-come-dine-with-xerox
Business operations

HP shareholders invited to come dine with Xerox

17 Feb 2020