Amazon defies the economic slowdown and starts the year growing strongly, according to the results it announced this Thursday and which have been received with strong rises in the Stock Market, of more than 10%, after normal market hours.
The group has returned to profit and has announced that its workforce has dropped to 1,465,000 jobs, 157,000 less than a year ago.
Net sales increased by 9% in the first quarter to 127,358 million dollars (about 115,500 million euros at the current exchange rate), compared to 116,444 million in the same period of 2022. The growth would have been even higher, from 11 %, except for the negative impact of exchange rates.
The giant of electronic commerce and cloud computing has returned to profit after the losses of the first quarter and of the year 2022 as a whole. Between January and March of this year it earned 3,172 million dollars, compared to the red numbers of 3,844 million for the last year.
The net result is very marked by the changes in value of its investee Rivian, manufacturer of electric cars, but the operating result increases 30% to 4,774 million, despite an extraordinary 500 million for severance pay.
Operating cash flow for the last 12 months improves by 38%.
What analysts liked the most has been the strong growth in turnover, although it is mainly concentrated in services, while that of products is stagnant.
Sales of online stores fell slightly and those of physical stores rose 7%.
It is the commissions for services to third parties, subscription income, advertising and the cloud that act as the engine.
Sales rose 11% year-over-year in North America to $76.9 billion.
In the international area they grew by 1%, up to 29.100 million dollars, but would have increased by 9% at constant exchange rates.
And the billing of the server and cloud computing business, Amazon Web Services (AWS), increased 16%, to 21.4 billion dollars.
The latter, although it is the smallest, is the most profitable division and contributes the majority of the operating result (5.100 million dollars).
yes, it has slowed down its growth rate.
The group founded by Jeff Bezos expects to continue increasing its turnover strongly, according to the forecasts it has revealed.
It forecasts that sales will be between 127,000 and 133,000 million dollars in the second quarter, which represents a growth of 5% to 10% year-on-year, as reported to the United States Securities and Exchange Commission (the SEC).
The evolution of profitability is more up in the air.
It expects operating profit to be between $2 billion and $5.5 billion, up from $3.3 billion in the second quarter of 2022. Those forecasts assume, among other things, no additional business acquisitions, restructurings or legal settlements.
fewer employees
With the last round announced in March, the layoffs announced by Amazon amount to 27,000, a record number in the history of the sector.
It is the largest cut of all the technology companies in absolute terms, although in relative figures it is less than 2% of the total number of employees, since the company has around 1.5 million workers.
However, the layoffs are compounded by a silent staff adjustment.
Amazon closed the first quarter with 1,465,000 employees, compared to 1,622,000 a year earlier, according to data reported to the SEC.
It is a cut in one year of 10% of the workforce, of 157,000 employees, with figures that exclude subcontractors and temporary workers.
“There are many things we like about how our teams are serving customers, especially in the midst of an uncertain economy,” CEO Andy Jassy said in a statement.
Jassy has reviewed the different businesses of the company.
“Our Retail business continues to improve the cost of service in our distribution network, while increasing the speed with which we get products into the hands of customers.
We expect to have the fastest Prime delivery speeds in our history by 2023 ″, she has assured her.
As for the advertising business, it continues to post strong growth, largely thanks to “continued investments in machine learning that help customers see relevant information” when they interact with the platform, which in turn delivers “unusually good” for brands.
“As our AWS business encourages companies to spend more cautiously in this macroeconomic environment, we continue to prioritize building long-term relationships with customers, helping them save money, and making it easier for them to take advantage of technologies like language models of large size and generative artificial intelligence”, he concluded.
Amazon rides the wave of artificial intelligence and the fashion of bragging about it.
Jassy highlights its cost-effective machine learning chips (Trainium and Inferentia), large managed language models (Bedrock), and the CodeWhisperer AI code plugin.
“We like the fundamentals we're seeing in AWS and we think there's a lot of growth ahead,” she says.
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