Net profit (RAS) of the Internet retailer Amazon in the first quarter of 2016, totaled $513 million, significantly exceeding analysts ‘ expectations and setting a record for all history of existence of the company, follows from statements of the company.
Sales in the first quarter grew by 28% compared to the same period in 2015, reaching $29.1 billion At 30% increased sales of both American and international ramalingaiah units. The fastest growing division of the company became cloud Amazon Web Services — its sales in January—March grew by 64% compared to the first quarter of 2015, reaching $2.6 billion While the profitability of the operations of this division declined slightly.
On news of record profits the value of shares in Amazon jumped by 12%, bringing its capitalization to $280 billion.
“This quarter can be considered a knockout by Amazon, especially if you compare its results with eBay and Google”, — quotes the Financial Times of Cattle Wingo, CEO of ChannelAdvisor software company that works with Amazon. According to him, Amazon is not only pushed on the eBay market, but “with such growth, most likely, they took a piece of the market almost every [player]”.
As the Financial Times, in the first quarter, Amazon continued to invest in new areas, including in support of logistics operations, in efforts to reduce cost of “last mile” (delivery directly to the door of the customer, retailers is considered the most expensive part of shipping the goods), as well as in the production of original video content, since the company actively involved in the struggle for the market of streaming services. In the second quarter, judging by the words of financial Director Brian Amazon Olawski, investment in video production can grow, resulting in a reduction in net profit. The company’s founder Jeff Bezos had previously argued that he does not consider the profit best indicator of company health.