Jan 30, 2020 - Technology

Amazon announces big earnings beat

Photo: Leon Neal/Getty Images

Amazon announced strong quarterly results Thursday after the market close, with $6.47 earnings per share on an expected $4.04 (per FactSet) and total revenue of $87.44 billion on $86.02 billion expected.

Why it matters: Wall Street has wondered whether Amazon's huge investments in one-day delivery and cloud services would depress its financial performance. This quarter, at least, gave investors a positive surprise.

Details: Amazon CEO Jeff Bezos announced Thursday that its Amazon Prime subscription offering has now reached 150 million users globally, which is just shy of Netflix’s 167 million global paid subscribers.

  • But unlike Netflix, Amazon didn’t offer a geographical breakdown of those subscribers. (The majority of Netflix subscribers are international.)
  • That number is up from “over 100 million” which was last reported almost two years ago.
  • In a statement, Bezos touted the success of Amazon Studios, the entertainment division that creates and acquires thousands of movies and TV shows offered exclusively to Prime members.
  • He didn’t offer any exact viewership metrics, but noted that Prime members watched twice as many hours of original programming (programming produced by Amazon Studios) last quarter than the quarter of the prior year.

On the advertising front, Amazon reported that its “other” category, which is mostly made up of advertising revenue, was up 41% year-over-year to over $4.7 billion.

  • Amazon’s ad business, while growing rapidly, is notably different from Google’s in that it’s mostly marketers paying to promote their products in search, and thus it's more like a fee to participate in the marketplace rather than true low-funnel advertising. To maintain ad growth, Amazon has experimented with more brand ads, especially video.
  • Amazon also announced that its Fire TV hardware product, which competes with Roku and Apple TV, now has more than 40 million active users worldwide.

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Amazon wants to depose Trump in lawsuit over $10 billion Pentagon contract

President Trump with Defense Secretary Mark Esper. Photo: Andrew Caballero-Reynolds/AFP via Getty Images

Amazon wants to depose President Trump, Defense Secretary Mark Esper and former Defense Secretary James Mattis as part of its lawsuit against the Pentagon for granting a $10 billion cloud computing contract to Microsoft, court documents filed on Monday show.

Why it matters: Amazon claims the decision last year to hand Microsoft a $10 billion contract for the Joint Enterprise Defense Infrastructure (JEDI) was influenced by Trump, who has repeatedly and publicly taken shots at Amazon and its owner Jeff Bezos.

Amazon grants first look at Rivian's electric delivery vehicles

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Amazon is sharing new info about its late 2019 vow to buy 100,000 electric delivery vehicles from Rivian.

Why it matters: It's among the most aggressive moves in the fleet electrification space and, if indeed it proceeds, will cement Rivian's prominence among electric vehicle startups.

Amazon lawsuit causes judge to temporarily block Microsoft Pentagon contract

Jeff Bezos. Photo: Mandel Ngan/AFP via Getty Images

A federal judge has temporarily blocked the $10 billion cloud computing contract the Defense Department awarded to Microsoft as it reviews a lawsuit by Amazon, CNBC reports.

The big picture: Amazon claims the decision to hand Microsoft the contract for the Joint Enterprise Defense Infrastructure (JEDI) project in late October was influenced by President Trump, who has repeatedly and publicly taken shots at Amazon and its owner Jeff Bezos.

Go deeperArrowUpdated Feb 13, 2020 - Technology