Shares of Amazon climbed as much as 12.2% in extended trading on Thursday after smashing earnings expectations for the fourth quarter.
The company’s market cap surged above $1 trillion after hours on the back of the powerhouse earnings report. In doing so, it joins Apple, Alphabet and Microsoft, which have all crossed the trillion-dollar threshold.
Here are the key numbers:
- Earnings per share: $6.47 per share vs. expectations of $4.03 per share, according to analysts surveyed by Refinitiv
- Revenue: $87.44 billion vs. expectations of $86.02 billion, per Refinitiv
- Amazon Web Services: $9.95 billion vs. expectations of $9.81 billion, according to FactSet
The company also gave upbeat guidance for the first quarter, saying it now expects to report revenue between $69 billion and $73 billion.
In the earnings release, Amazon CEO Jeff Bezos said “more people joined Prime this quarter than ever before” and that the company now counts more than 150 million paid Prime members around the world. Amazon last gave an update on Prime subscribers in April 2018, saying it had more than 100 million members in the program.
Revenue grew 21% to $87.44 billion for the quarter, which indicates the company’s investments in speedier shipping are leading to more purchases. As expected, Amazon’s worldwide shipping costs increased significantly during the quarter, climbing 43% year over year to $12.9 billion. The company said in its last earnings report in October that it would spend $1.5 billion during the holiday shopping season to expand one-day and same-day delivery.
Amazon’s subscription services revenues have climbed steadily over the past several quarters. Revenue from subscription services, which includes Prime membership fees, as well as Music Unlimited and Prime Video Channels, came in at $5.24 billion for the quarter, up 32% from the year-ago period. In the earnings release, Amazon said Music Unlimited subscribers grew more than 50% in 2019.
Aside from retail, Amazon’s cloud business reported $9.95 billion in sales, up 34% from the year-ago quarter. That’s a slight deceleration from the third quarter, when Amazon Web Services (AWS) saw revenue growth of 35%. AWS operating income was $2.6 billion, up 19% from the year-ago period and above consensus estimates of $2.45 billion.
Amazon’s “other” category, which is primarily made up of its advertising business, generated $4.8 billion in revenue during the quarter, which is a 41% increase from the year-ago period.
Amazon’s physical-store sales, which is mainly comprised of Whole Foods, saw its revenue decline 1% year over year to $4.36 billion.
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