Amazon.com Inc posted third-quarter (3Q) profit and sales above Wall Street estimates, helped by favourable retail sales, sending its shares up 5.7% after the closing bell.
The company indicated it expected healthy results in the holiday quarter, its largest of the year, thanks to its faster shipping times and a move to stock lower costs items.
Amazon's upbeat results could signal a better-than-feared holiday season for retailers, who have been bracing for the slowest pace of holiday sales growth in six years.
Three months ago, Amazon executives warned that consumers were "cautious with their spending" and seeking less-expensive options.
However, Amazon reported a 7% improvement in retail sales in the quarter ended Sept 30 to US$61.41 billion. The after-hours gain in the share price more than made up for a decline during regular trading.
The operating margin for Amazon's international business jumped to 3.6% in 3Q from 0.9% in 2Q. The North America margin ticked up to 5.9% from 5.6% in the previous quarter.
Amazon Web Services (AWS), the company's cloud business, reported a 19% increase in sales to US$27.5 billion, in line with estimates, according to LSEG data. It was the quickest pace of growth in seven quarters for AWS, which accounts for a fifth of Amazon's overall sales but roughly two-thirds of its revenue.
Ahead of the earnings report, Amazon shares closed the trading session down 3.3%. The shares had risen almost 23% this year, beating a nearly 20% jump in the broader market.
