Amazon.com Inc reported a better-than-expected rise in quarterly revenue on Thursday (July 28), powered by blockbuster growth in its cloud services unit.
Amazon’s web retail sales in the United States and internationally, the core of the company’s business, also topped expectations, and it forecast revenue ahead of expectations for the third quarter. Shares of Amazon, the world’s biggest online merchant, were up 2 percent in after-hours trading.
The Seattle-based company is riding a wave of retail sales moving to the internet and is using original videos in a Netflix-like service to win new customers. The cloud business, Amazon Web Services, is the company’s fastest growing business and is regarded by analysts as the next driver of growth for the company.
The company’s net sales in North America, its biggest market, jumped 28.1 percent to $17.67 billion.
Revenue from Amazon Web Services surged 58.2 percent to $2.89 billion. This beat the average estimate of $2.83 billion.
The company’s net sales rose 31.1 percent to $30.40 billion in the second quarter ended June 30.
Alphabet Inc, Google’s parent, posted a 21.3 percent increase in second-quarter revenue, exceeding analysts’ expectations, as the tech giant continued to nudge its vast advertising business toward mobile and capitalized on the boom in video.
The sharp revenue growth suggests that Google is successfully navigating the high-stakes transition from desktop to mobile advertising.
The company’s shares rose 6.5 percent to $816 in after-hours trading on Thursday.
Alphabet’s consolidated revenue rose to $21.50 billion in the three months ended June 30, from $17.73 billion a year earlier. Analysts on an average were expecting revenue of $20.76 billion.
Net income rose to $4.88 billion, or $7 per Class A and B common stock, from $3.93 billion, or $4.93 per share.
Excluding items, the company earned $8.42 per share, beating analysts average estimate of $8.04.
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