NOh, the brilliant performance of Apple, Microsoft, Facebook and Google’s parent company Alphabet actually comes from AmazonThe good news for .com is expected. However, when the online retailer released its data after the close on Thursday, it was disappointing: Sales growth in the most recent quarter slowed significantly, lower than analysts expected. In after-hours trading, the stock price temporarily fell more than 6% of its value.
Amazon is considered one of the big winners of the new crown crisis. The core business of online transactions benefits from more and more people shopping online.even Amazon Web Services (AWS) is a cloud computing sector that has become more and more important in recent years, with rapid growth.
The situation in the second quarter was mixed: Group-wide sales increased by 27% to 113.1 billion U.S. dollars. This is lower than the average analyst forecast of 115.2 billion US dollars, a significant slowdown compared to the first quarter, when sales were still up 44%. This time, of course, Amazon also had to fight high standards. The last quarter was the first quarter to fully manifest the pandemic.
In all things, online retail is weak
The lower-than-expected sales growth was mainly due to online retail. This time sales only increased by 13%, while the increase in the first two quarters was more than 40%. This slowdown is even more surprising, because “Prime Day” dropped in the last quarter, when Amazon launched special offers ads. In the past, this Prime Day was always regarded as a sales driver.
On the other hand, the cloud division AWS performed well again. There was even the strongest growth in more than a year, with sales increasing by 37%. AWS is also particularly important to Amazon because the business is particularly profitable. Although accounting for only 13% of sales, it contributed more than half of the company’s total operating profit in the last quarter. The online advertising sector may also have disproportionately high profit margins and also have strong growth. The positive development of these profitable businesses helped net profit increase by 48% to US$7.8 billion in the last quarter. Earnings per share were higher than expected.
In terms of sales, Amazon is also cautious about the third quarter that has already started. The organization predicts that the growth rate will be between 10% and 16%, which is a further significant slowdown.
The worse-than-expected result came a few weeks after the company’s turning point: on July 5, founder Jeff Bezos resigned as CEO. His successor is Andy Jassy (Andy Jassy), who was previously responsible for operating AWS.
