Amazon has another 'Prime' holiday: Profit tops USD 3 billion

Amazon’s slower sales growth is due in part to the law of large numbers. It’s harder to keep growing fast with quarterly sales that stretch to 11 digits

Amazon has another 'Prime' holiday: Profit tops USD 3 billion

"In 2018, we improved Alexa's ability to understand requests and answer questions by more than 20 per cent through advances in machine learning", Bezos said in a statement. Sales in the web services unit grew 45 percent in the quarter. Fees merchants pay Amazon to ship and advertise their products have fattened the company's once-thin profit margins.

Additionally, the company's net income increased to $3.0 billion United States dollars (roughly $3.94 billion CAD) in Q4 2018, compared to $1.9 billion USD (roughly $2.49 billion CAD) in Q4 2017.

Yet, investors turned their attention overseas where Amazon has long lost money in the hopes of future profit.

Amazon's chief financial officer, Brian Olsavsky, said he expects Prime Video spend to "increase even further in 2019" but would not put a price on its programming budget.

The company began removing a wide array of products from its India website late on Thursday to comply with the new foreign investment curbs that kick in on February 1, Reuters reported.

Sales increased in all but one of Amazon's five categories.

A worker sorts parcels at Amazon's fulfilment centre in Peterborough, Britain November 15, 2017.

Shoppers will spend $484 billion globally on Amazon this year, up 26 percent from 2018, and the Seattle-based company will capture more than half of all online spending in the US, according to EMarketer Inc. This guidance anticipates an unfavorable impact of approximately 210 basis points from foreign exchange rates. But this year investments will rise, though Olsavsky did not detail where or how much.

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Mr Saunders said the firm's profits were also "impressive".

"If they are stepping on the accelerator, that means they like what they're seeing, and it's worthy of more investment", he said.

For the full year, Amazon spent $27.7 billion on shipping, an increase of $6 billion or roughly 27.6 percent over the prior year, according to GeekWire research. It has just published its financial reports for the fourth quarter of a year ago, and it says its revenue is up 45 per cent.

Overall, net sales for the fourth quarter rose 19.7 per cent to US$72.38-billion and beat the analyst average estimate of US$71.87-billion on the back of a strong holiday season, which includes the major USA shopping event Black Friday.

Amazon on Thursday reported its profit in the past quarter surged on strong holiday retail sales and its soaring cloud computing business.

FILE PHOTO: The logo of Amazon is pictured inside the company's office in Bengaluru, India, April 20, 2018. That should please Wall Street, but also indicates that Amazon may not pursue as many new projects as it has before - though there are still plenty.

"We are plugging into Amazon the same way we do for everyone: Facebook, Google, Instagram, Pinterest, Snapchat", says Alex Collmer, CEO of VidMob.

The Seattle-based company reported a profit of $3.03bn, or $6.04 a share, up from $1.86bn, or $3.75 a share, on the same quarter a year earlier.

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