Amazon sales and profits climb in Q2

Amazon has welcomed a strong second quarter of trading, with sales rising by 11% to $134.4bn (£105.8bn) in the period, up from $121.2bn (£95.4bn) the prior year, amid a record-breaking Prime Day and cost cuts across the business. North America sales rose by 11% to $82.5bn (£64.9bn), international sales by 10% to $29.7bn (£23.4bn), and AWS sales by 12% to $22.1bn (£17.4bn). Operating income increased to $7.7bn (£6bn) in the quarter, up from $3.3bn (£2.6bn) the previous year, while net income hit $6.7bn (£5.3bn), compared with a net loss of $2.0bn (£1.6bn) in the second quarter of 2022. It comes as the retail giant welcomed its biggest Prime Day event ever on July 11-12, with more than 375 million items purchased worldwide. Amazon said it also offered more deals than any past Prime Day, with Home, Fashion, and Beauty among the top-selling deal categories. It was ultimately the largest Prime Day ever for Amazon’s independent sellers, most of which are SMEs. Andy Jassy, Amazon CEO, said: “It was another strong quarter of progress for Amazon. We continued lowering our cost to serve in our fulfilment network, while also providing Prime customers with the fastest delivery speeds we’ve ever recorded. “Our AWS growth stabilised as customers started shifting from cost optimization to new workload deployment, and AWS has continued to add to its meaningful leadership position in the cloud with a slew of generative AI releases that make it much easier and more cost-effective for companies to train and run models (Trainium and Inferentia chips), customise Large Language Models to build generative AI applications and agents (Bedrock), and write code much more efficiently with CodeWhisperer.” He added: “We’re also continuing to see strong demand for our advertising services as the team keeps innovating for brands, including the ramp up for Thursday Night Football with the ability for advertisers to tailor their spots by audience and create interactive experiences for consumers. We remain excited about what lies ahead for customers and the company.” Looking ahead to the third quarter, net sales are expected to be between $138.0bn (£109bn) and $143.0bn (£113bn), or a growth of between 9% and 13% compared with the prior year. Operating income is expected to be between $5.5bn (£4.3bn) and $8.5bn (£6.7bn), compared with $2.5bn (£2bn) in the third quarter of 2022.