Amazon’s share price soars after posting better than expected results
Amazon's share price has soared after it reported better than expected first quarter results.
Shares in the company rose over 12 per cent in after hours trading after posting strong results, a quarter after having been pounded after profit missed the mark.
The e-commerce giant reported net income was $513m in the first quarter, or $1.07 per diluted share, compared with net loss of $57m, or $0.12 per diluted share, in first quarter 2015.
That's also against expectations of net income of $0.57 per share.
Meanwhile, net sales was posted at $29.1bn, up 28 per cent from the $22.7bn reported in the first quarter last year, and higher than analysts' forecasts of $28bn.
Operating income was $1.1bn in the first quarter, compared with $255m in first quarter 2015.
Read more: Amazon Prime Now one and two-hour delivery comes to Surrey, Hampshire and Berkshire
For the next quarter Amazon expects net sales of between $28bn and $30.5bn.
"Amazon devices are the top selling products on Amazon, and customers purchased more than twice as many Fire tablets than first quarter last year," said Jeff Bezos, founder and chief executive of Amazon.com.
"Earlier this week, the $39 Fire TV Stick became the first product ever — from any manufacturer — to pass 100,000 customer reviews, including over 62,000 five star reviews, also more than any other product ever sold on Amazon.
"Echo too is off to an incredible start, and we can’t yet manage to keep it in stock despite all efforts. We’re building premium products at non-premium prices, and we’re thrilled so many customers are responding to our approach."
The results will be welcome news for Amazon, which is a clear leader in online retail and cloud storage, but got hammered in January after missing estimates.
Amazon Web Services, the company's cloud computing segment, has excited many investors, and revenue in that part of the company rose 63.9 per cent to $2.6bn.
The company has made a number of investments this year, including new data centres and new fashion lines.
Read more: Amazon and Microsoft in talks to park in self-driving car space with cloud computing
Amazon has been ramping up its services in the UK and Europe. In January it announced it will create thousands more jobs in Europe and UK in fulfillment, R&D and software development.
Meanwhile, in late February Morrisons announced it had secured a major new agreement with Amazon to sell "hundreds of products" via Prime Now and Pantry.
That followed the launch of Amazon's Pantry service, offering Amazon Prime customers next-day delivery on over 4,000 "everyday essentials", including major food and drink brands, household supplies, and health and beauty.
The group has also put more traditional grocery brands on edge with the rollout of Amazon Fresh, which launched in London and Birmingham last October under the Amazon Prime Now banner. The Fresh service offers delivery of kitchen essentials within an hour of ordering.
It was also announced today that Amazon illegally charged parents for their children's in-app purchases between 2011 and 2014.