Amazon posts USD 3.2-bn profit as it goes through multiple layoffs
Apr 28, 2023
Seattle (Washington) [US], April 28 : Amazon is starting the year back in the black. The e-commerce giant on Thursday reported a profit of USD 3.2 billion for the first quarter, far exceeding analysts' estimates, CNN Business reported on Friday.
The Seattle-headquartered firm reported a loss of USD 3.8 billion in the year-ago quarter.
The swing to a profit comes as Amazon has ramped up its cost-cutting measures in recent months. The company has announced two rounds of layoffs, cancelled products and nixed physical store expansions, according to CNN Business.
It also comes as key areas of Amazon's business continue to grow despite lingering recession fears possibly weighing on corporate and consumer spending.
The company's revenue increased 9 per cent during the quarter from the prior year. Amazon expects second-quarter net sales to grow between 5 per cent and 10 per cent from the same period the year before, or be between USD 127 billion and USD 133 billion, CNN Business reported.
"The results indicate that ongoing cost-cutting measures are having a positive impact on Amazon's business prospects," said Jesse Cohen, senior analyst at Investing.com. "Amazon's strong guidance for Q2 revenue is another indicator that the company may be starting to come out of the woods."
Amazon Web Services, which has long served as a profit engine for the company, also experienced double-digit percentage growth during the quarter, in another positive sign for its overall business.
AWS segment sales rose 16 per cent from the year before to USD 21.4 billion, CNN Business said, adding, "That comes after sales growth slowed in the previous quarter, as cloud customers tightened their purse strings due to uncertainty about the economy's health."
"While our AWS business navigates companies spending more cautiously in this macro environment, we continue to prioritise building long-term customer relationships," Chief Executive Officer Andy Jassy said in a statement accompanying the earnings release.
