Structural change sees AWS NZ report sales of $372M

Structural change sees AWS NZ report sales of $372M

AWS New Zealand's reported sales increase by a factor of four, but there's a catch.

Tim Dacombe-Bird (AWS)

Tim Dacombe-Bird (AWS)

Credit: AWS

Amazon Web Services NZ saw its reported sales in 2021 grow by a factor of four in 2022, from $93.8 million to $372 million.

However, a structural change contributed greatly to that apparent growth while also ensuring the latest accounts better represent the full scale of AWS' business in New Zealand.

AWS New Zealand became the official reseller of AWS cloud services locally in November 2021, replacing its US parent. The 2021 year, therefore, reflected just of two months of customer cloud services revenue while the newly-filed 2022 accounts cover the full year.

The filings also show the business booked a loss before tax of $4.9 million, mainly due cloud service fees charged by its parent which, predictably given the changes, increased from $32.5 million to $277.8 million. 

The loss for the 2022 year resulted in a $2.1 million tax credit, likely usable against future profits.

While charges from related parties multiplied, sales to related parties fell sharply during the year, from $43 million to $8 million.

Wages and salaries paid by the New Zealand business increased from $40.3 million to $58.3 million year on year.

The filing comes as the cloud giant is in the throes of building a New Zealand cloud region, which is expected to open next year.

AWS said $7.5B would be spent on construction, operations, equipment and staff for those facilities over 15 years. The region is expected to include three availability zones in Auckland, each serviced by one or more data centres.

The strengthening shift to public cloud platforms such as AWS, Microsoft Azure and Google Cloud is also posing challenges for local infrastructure as a service providers.

Reporting its half year results last month, NZX-listed Spark informed shareholders revenue in its cloud, security, and service management business decreased 4.5 per cent to $214 million as what the telco described as a "mixshift" to public cloud and away from private cloud continued.

This resulted in a "repricing" of private cloud, presumably downwards, that impacted margins.

Local AWS customers include Air NZ, ANZ Bank, Bank of New Zealand, Contact Energy, Education Perfect, Halter, New Zealand Department of Conservation, Lancom, New Zealand Ministry of Health, New Zealand Ministry of Justice, Orion Health, Sharesies, The Clinician, TVNZ, UneeQ, University of Auckland, Vodafone, and Xero.

NZ Post, working with partner Datacom, joined the list in 2022, as did Loyalty NZ, working with The Instillery.

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Tags Amazon Web ServicesAWS



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