[Financial Summary] Amazon does not announce cloud growth acceleration dividend payments
Major US online shopping company $Amazon(AMZN.US$has announced financial results for the 1st quarter of 2024.AWS operating marginIsA record highAlthough it was recorded, sales and operating profit for the 2nd quarterThe outlook is slightly weaker than expectedSales for the second quarter are likely to be the slowest growth rate since December 2022, and $Meta Platforms(META.US$with $Alphabet-A(GOOGL.US$Following the first in historyDividend distribution was not announcedIt is said that this made investors somewhat disappointed.
First quarter (January-March)
●turnover: 143.31 billion dollars (up 12.5% from the same period last year, forecast 142.59 billion dollars)
●EPS (earnings per share): $0.98 (up 216% year over year; expected $0.83)
●Operating profit: 15.31 billion dollars (up 219% from the same period last year, forecast 11.2 billion dollars)
●net profit: 10.43 billion dollars (up 225% from the same period last year, forecast 8.9 billion dollars)
Sales and EPSIt exceeded expectations, but it was weak compared to the year-end sales season in the fourth quarter of last year.net profitIt also fell short of 10.62 billion dollars in the fourth quarter of last year, which was a high level for the first time in 2 years. According to the company, the net profit for the first quarter of 2024 is an EV startup manufacturer that is a “rival to Tesla” $Rivian Automotive(RIVN.US$Pre-tax valuation losses of $2 billion due to common stock investments are included in non-operating expenses ($500 million for the same period last year)。
It far exceeds sales, according to analystsIncrease in operating profitiscost reductionwithFocus on efficiencyThis is the latest sign that it is boosting the company's earnings. Amazon will have about 27,000 people from 2022 to 2023Massive layoffsIt has been implemented, and in the first quarter of this year, the healthcare division and AWS are further proceeding with personnel reductions on a scale of several hundred people.
Forecast for the second quarter (April-June)
●Net sales:144-149 billion dollars (up 7% to 11% from the same period last year, forecast 15.2 billion dollars)
●Operating profit:10 to 14 billion dollars (increase of 30% or more compared to the same period last year, forecast 12.56 billion dollars)
●Net sales:144-149 billion dollars (up 7% to 11% from the same period last year, forecast 15.2 billion dollars)
●Operating profit:10 to 14 billion dollars (increase of 30% or more compared to the same period last year, forecast 12.56 billion dollars)
Amazon Chief Executive Officer Andy Jassie (CEO) pointed out in a statement that “in addition to resuming corporate infrastructure modernization, the appeal of AWS's AI functions is re-accelerating the growth of AWS.” It is said that Amazon Web Services (AWS) is currently at a pace where annual sales of 100 billion dollars are achieved. At the local financial results briefing on 4/30, it was stated that “client companies have completed most of the cost optimizations in the cloud field and are trying to change their business with AI.” It was emphasized that the cloud business has generated sales of billions of dollars in relation to generative AI, and that it is capturing demand compared to other companies.
According to the Nikkei Shimbun, the business is globalTop cloud infrastructure market with 30% market shareThat's it.
Advertisement businessIt is also benefiting from the growth of stores and Prime Video, and he stated that “all businesses are still in the early stages,” suggesting great potential for the future. Amazon'sAdvertisement businessis close to 15%, after Google and Meta3rd place in market shareI'm putting it on.
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By business
●Online store sales: $54.67 billion (up 7% from the same period last year; forecast $54.77 billion)
●Physical store sales: 5.20 billion dollars (up 6% from the same period last year, forecast 5.08 billion dollars)
●AWS sales: 25.04 billion dollars (up 17% from the same period last year, forecast 24.11 billion dollars)
●Advertisement sales: $11.82 billion (up 24% year over year, in line with expectations)
In the fourth quarter of 2023, Amazon's advertising revenue was 14.65 billion dollars, up 27% from the same period last year5 consecutive quartersIt grew at an accelerated pace,AWS salesis 24.24 billion dollars, up 13% from the same period last year,AWS's operating margin in 2023 is 27%It was.
This is Amazon's AWS revenue growth in the first quarter2 consecutive quartersIt means accelerated growth. Of rivals whose cloud revenue increased 23% and 28%, respectively, in the same quarterMicrosoft and Google parent company alphabetIn the quarterly report ofAccelerating cloud revenueSimilarly, it suggests that the cloud business is on a recovery trend.3rd quarter of 2023What is the revenue growth of AWSPut an end to six consecutive quarters of slowdownIt has returned to its first acceleration of growth since the fourth quarter of 2021.
AWS did not announce the highest operating margin ever dividend payment
Demand for generative AI tools and serviceswill be the driving force behind cloud provider growth. AWS's operating margin in the first quarter of 2024Record high of 37.6%Then, it surpassed 30.3% in the 3rd quarter of 2023 and 29.6% in the 4th quarter.
Demand for generative AI tools and serviceswill be the driving force behind cloud provider growth. AWS's operating margin in the first quarter of 2024Record high of 37.6%Then, it surpassed 30.3% in the 3rd quarter of 2023 and 29.6% in the 4th quarter.
Investing in artificial intelligenceattracts attention. The fact that after Meta raised its capital investment forecast drastically this year, stock prices plummeted by 2 digits means that investors will spend the next few years,I'm starting to lose patience with investing a lot of money in AIIt is said that it means.
Cloud providers such as Amazon are actively investing in artificial intelligence, including buying advanced chips and building new data centers. $Microsoft(MSFT.US$To and Google have also stated that they will invest more money into the construction of artificial intelligence data centers.
Amazon positions its company as a leader in artificial intelligence, and AI is anticipating potential revenue of tens of billions of dollars in the company's cloud business. Chief Executive Officer Andy Jassie (CEO) stated in a “letter to shareholders” announced in April that “generative artificial intelligence may be the biggest technological transformation since the internet.”
What has the highest growth rateAdvertisement businessSo, in January this year, the company launched a video distribution service”Prime VideoOn “(Prime Video)”Introduction of adsI started it for the first time. Until now, most of Amazon's advertising revenue has come from sales of advertisement display space on e-commerce marketplaces.
Jassi said he believes Prime Video will grow into a big, profitable business on its own, and streaming ads are growing rapidly and getting off to a good start.
Following the fact that Meta and Google paid dividends this year, there is a high level of market interest in whether Amazon will also issue dividends for the first time.However, Amazon is the first in the company's historyIt has not been announced that dividends will be paid. The company is the last major tech company that has yet to pay dividends to shareholders. AmazonCompany stock buybacksSince 2022/6, when 3.3 billion dollars were invested, there has been no movement, and it is said that there is a possibility that information on stock buybacks and dividends will strongly boost stock prices. However, according to New Street Research, Amazon is unlikely to pay dividends and insteadCompany stock buybacksI think there is a high possibility of working on it.
This article uses automatic translation for some of its parts
Source: Bloomberg, Reuters, Nihon Keizai Shimbun, moomoo
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のまじ : You can buy our own shares.
大負けネコ : It's always exciting before Amazon's quarterly results are announced.
Just as the meta evaluation dropped, there was also a possibility that it would not reach the expected value, and while looking at the Moomoo board information, I was worried until the last minute.
Thanks to that, I was able to grab a slightly higher price, which was slightly lower than the donation, but I was relieved to hear that it had risen outside of hours.
I was hoping for my first dividend if possible, but a stock buyback is enough.
Most of my EC purchases are on Amazon, and I'm also subscribed to Amazon Prime.
I want them to somehow establish a strong business model by making full use of generative AI and cloud data centers.
The best thing is not to drop out of GAFAM.