From CNBC: 2024-08-01 20:16:55

Amazon shares fell after second-quarter sales missed expectations, despite strong cloud business performance. Revenue rose 10% to $147.98 billion, with earnings per share at 1.26 cents. Operating income increased 91% to $14.67 billion, beating expectations. AWS revenue hit $105 billion with operating margins at 35.5%. North American sales grew 9%, with improvements in cost structure globally. Forecast for the third quarter missed estimates, with net sales expected between $154 billion to $158.5 billion.

Amazon’s cloud business, AWS, had strong revenue growth at 19% year over year. CEO Andy Jassy highlighted three trends driving the growth, with AI sales growing significantly. Overall sales missed consensus estimates, with lower average selling prices due to customers trading down. Improvements in cost structure and operational efficiencies are key for Amazon’s profitability. The company expects to increase investments in AWS infrastructure in the coming months.

Despite a slight decline in North America operating margins, Amazon continues to work on reducing costs to improve profitability. The company is investing in automation and regional networks to enhance cost efficiency. The third-quarter guidance fell short of expectations, with net sales between $154 billion to $158.5 billion and operating income of $11.5 billion to $15 billion. Continued efforts to lower costs and expand operations remain a focus for the company.



Read more at CNBC:: Amazon’s messy second quarter doesn’t change our outlook on the stock