Amazon Bounces Back: Q2 2023 Results Show Substantial Profit Growth and Successful Cost-Cutting Strategies
Amazon is cruising past expectations
Amazon is setting its sights high for Q2 2023 following a string of underwhelming quarters. In its latest quarterly report, the e-commerce giant reported substantial profits, recording its highest earnings since Q4 2020. The company has demonstrated a resurgence to double-digit revenue growth, suggesting that CEO Andy Jassy’s cost-saving strategies are yielding positive results.
As reported by CNBC, Amazon embarked on its cost-cutting drive last fall with the largest layoff in the company’s history, shedding 27,000 jobs and subsequently freezing corporate hiring. Global workforce numbers dropped 4% to 1.46 million people by the end of Q2. In the past quarter, Amazon reported a net income of approximately £4.9 billion GBP with an EPS of 65 cents, exceeding the anticipated 35 cents. The net sales reached around £98.5 billion GBP, surpassing the estimated £96.5 billion GBP.
Amazon reported a revenue growth of 11% year-on-year. The revenue from its advertising and cloud businesses also exceeded expectations, with ad revenue reaching approximately £7.8 billion GBP against an anticipated £7.6 billion GBP, and its Amazon Web Services (AWS) generating around £16.2 billion GBP, surpassing the estimate of £16 billion GBP. With sales increasing 12% in Q2 to around £16.2 billion GBP, AWS contributed to 70% of Amazon’s £5.6 billion GBP operating profit. The company also reported a net income of around £4.9 billion GBP after noting a £1.5 billion GBP loss last year. For the third quarter, the company’s sales are expected to fall between £101.1 billion and £104.9 billion GBP, reflecting a growth between 9% and 13%.
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