AWS floats Amazon’s financials

AWS floats Amazon’s financials

AWS delivered its strongest absolute dollar growth while Amazon showed lackluster performance in the second quarter of 2017

Amazon Web Services (AWS) is driving growth for its parent company, Amazon, as reflected in its second quarter financials for 2017.

The global tech giant fell short on earnings, bringing in Earnings Per Share (EPS) of US$0.40 per share as compared to US$1.42 per share expected, according to CNBC.

Its revenue was US$38 billion, up from the US$30.4 billion in sales it brought in during the second quarter last year.

But Amazon’s “otherwise lackluster” performance was boosted by AWS, as it delivered its strongest absolute dollar growth, both sequentially and year-to-year, surging to a more than US$16 billion annualised run rate with US$4.1 billion in 2Q17 revenue, according to Technology Business Research (TBR). 

A report by Business Insider showed that the company’s sales were supported by results from its services business, specifically its AWS cloud computing business. 

Compared to the same time last year, AWS’ revenue was up 42 per cent and Amazon’s overall service revenues rose 42 per cent to $US13.2 billion. 

TBR analyst, Meaghan McGrath, said accelerated AWS usage has balanced broader Amazon underachievement with growth that provokes expedited capacity expansion. 

She mentioned that AWS delivered “solid performance”, noting the 42 per cent year-to-year revenue growth was supported by usage of the largest AWS services. 

“[It] is growing at a faster pace than revenue, and accelerating, which further prompts global capacity expansion,” she said. 

But, McGrath said its rapid geographic expansion has hindered AWS’ operating margin, which dropped 260 basis points from the second quarter of 2016 to 22.3 per cent in the quarter. 

“While revenue growth will continue, so will global infrastructure expansion to meet customer demand, and margins will continue to be pressured. Despite this margin pressure, AWS will remain a critical component to Amazon’s corporate performance, driving both revenue growth and ongoing profitability,” she added. 

In the third quarter of 2017, Amazon expects to post revenue of between US$39.25 billion and US$41.75 billion. 

As for its operating results, it expects it to range from an operating loss of US$400 million to an operating profit of US$300 million.

"Third quarter certainly has a healthy amount of investments and we'll continue to grow those areas," Amazon chief financial officer, Brian Olsavsky, said during a press call

Most recently, Amazon founder, Jeff Bezos, briefly became the world's richest man, according to Bloomberg, when the company’s share price surged ahead of its quarterly results. When this occurred, Bezos was worth US$92.3 billion, surpassing Bill Gates’ US$90.8 billion valuation. But within hours, his worth slipped to US$89.3 billion, putting him behind Gates.

In Australia, Perth-based technology start-up, Tape Ark, recently launched in the Australian market through the release of a data storage solution leveraging AWS and Business intelligence (BI) software vendor, Yellowfin, has partnered with BI services provider, Toustone, to offer a web-based cloud solution on AWS.

Follow Us

Join the newsletter!


Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags amazonfinancialsAWSTBR



The making of an MSSP: a blueprint for growth in NZ

The making of an MSSP: a blueprint for growth in NZ

Partners are actively building out security practices and services to match, yet remain challenged by a lack of guidance in the market. This exclusive Reseller News Roundtable - in association with Sophos - assessed the making of an MSSP, outlining the blueprint for growth and how partners can differentiate in New Zealand.

The making of an MSSP: a blueprint for growth in NZ
Reseller News Platinum Club celebrates leading partners in 2018

Reseller News Platinum Club celebrates leading partners in 2018

The leading players of the New Zealand channel came together to celebrate a year of achievement at the inaugural Reseller News Platinum Club lunch in Auckland. Following the Reseller News Innovation Awards, Platinum Club provides a platform to showcase the top performing partners and start-ups of the past 12 months, with more than ​​50 organisations in the spotlight.​​​

Reseller News Platinum Club celebrates leading partners in 2018
Meet the top performing HP partners in NZ

Meet the top performing HP partners in NZ

HP has honoured its leading partners in New Zealand during 2018, following 12 months of growth through the local channel. Unveiled during the fourth running of the ceremony in Auckland, the awards recognise and celebrate excellence, growth, consistency and engagement of standout Kiwi partners.

Meet the top performing HP partners in NZ
Show Comments