By Akash Sriram and Greg Bensinger
(Reuters) – Amazon.com beat fourth-quarter revenue expectations on Thursday on robust growth in online spending during the critical holiday shopping season, sending its shares up 5% after the market close.
Despite the strong performance Amazon has begun the year by shedding jobs in several divisions. Plans to acquire iRobot, maker of the Roomba vacuum cleaner, for $1.4 billion were dashed by European regulators.
Amazon Web Services (AWS), the world’s largest cloud services provider, brought in revenue of $24.2 billion in the fourth quarter, compared with analysts’ expectations of $24.26 billion.
AWS CEO Andy Jassy in a statement touted the unit’s “continued long-term focus on customers and feature delivery,” citing efforts to incorporate generative AI into many of its services. The new features “are starting to be reflected in our overall results,” he said.
In what is seen as a boost to e-commerce firms, consumers splurged on goods and services over the holidays, despite high interest rates, a Commerce Department report last week showed.
Meanwhile, growth at Alphabet and Microsoft’s cloud units beat market expectations as customers wanted to test new AI features and build them for their own applications.
Revenue in the fourth quarter rose 14% to $170 billion, beating analysts’ average estimate of $166.21 billion according to LSEG data. Net income rose to $10.6 billion from $278 million in the year-ago period.
The company forecast current-quarter revenue of $138 billion to $143.5 billion. Analysts polled by LSEG expect $142.13 billion.
(Reporting by Akash Sriram in Bengaluru and Greg Bensinger in San Francisco; Editing by Arun Koyyur and Richard Chang)
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