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Amazon beats expectations to avoid tech earnings slump

<i>Nick Iwanyshyn/Reuters</i><br/>
REUTERS
Nick Iwanyshyn/Reuters

By Rishi Iyengar, CNN Business

Amazon appears to still be going strong even as other Big Tech companies stumble amid pressure from inflation and an economic downturn.

The e-commerce giant on Thursday reported net sales of $121.2 billion for the quarter ended June 30, a 7% increase from the same quarter last year and higher than the $119 billion forecast by analysts surveyed by Refinitiv.

Amazon stock surged more than 11% in after-hours trading following the results, shrugging off the company’s $2 billion loss that it attributed in part to its investment in electric truck manufacturer Rivian. Amazon posted a bigger loss last quarter that it similarly attributed to the Rivian investment.

“Despite continued inflationary pressures in fuel, energy, and transportation costs, we’re making progress on the more controllable costs we referenced last quarter, particularly improving the productivity of our fulfillment network,” Amazon CEO Andy Jassy said in a statement.

Amazon’s performance was buoyed by its cloud business, Amazon Web Services, which posted a profit of $5.7 billion on revenues of nearly $20 billion — a 33% increase from the same period last year.

The company’s after-hours stock jump was likely also a result of the optimistic guidance it released for the current quarter.

Amazon said it expects net sales between $125 billion and $130 billion for the third quarter, a potential growth of as much as 17% from last year.

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