Last updated on April 3rd, 2024 at 10:13 am

The world’s largest retailer surpasses Wall Street expectations with $170 billion in revenue while continuing to reduce jobs in recent weeks

Amazon’s profits have surged due to strong seasonal trading and robust growth in its dominant cloud computing business. The world’s largest retailer reported revenue of $170 billion in the three months ending in December, a 14% increase from the same period in 2022, surpassing Wall Street’s expectations of around $166 billion.

In the fourth quarter, net income surged to $10.6 billion from $278 million a year earlier as the company focused on cost-cutting and transitioning from years of rapid expansion since the pandemic began. Earnings per share reached $1.03.

Shares of the company rose 5.5% in after-hours trading in New York.

Amazon, valued at $1.6 trillion on the stock market, continued to reduce its workforce after cutting 27,000 jobs last year. The pace of layoffs has slowed in recent weeks.

Andy Jassy, the group’s CEO, announced on Thursday, “This Q4 marked a record-breaking holiday shopping season and concluded a strong 2023 for Amazon. While we achieved significant progress in revenue, operating income, and free cash flow, we are most pleased with the ongoing innovation and enhancements to customer experience across our businesses.”

Amazon has created a vast digital empire around its e-commerce platform, extending to smart speakers and sports broadcasting. It maintains a dominant position in the lucrative cloud computing market through Amazon Web Services (AWS). However, Microsoft, now valued at $3 trillion, has narrowed its lead as companies incorporate artificial intelligence into their services.

Before the earnings call, the company revealed plans to integrate an AI-powered shopping assistant named Rufus into its app. Jassy noted during the call that Amazon’s AI services are highly popular with customers, although the revenue impact has not been significant yet.

The company announced on Thursday the launch of Rufus, an AI-powered shopping assistant, on its mobile app.

Regulators have taken steps to limit the company’s expansion. Earlier this week, Amazon abandoned its planned $1.4 billion acquisition of the robot vacuum cleaner company iRobot due to opposition from European regulators. In addition, US regulators announced last week that they would investigate the company’s dealings with emerging AI firms like Anthropic.

In the fourth quarter, revenue at AWS grew by 13% to $24.2 billion. Jassy highlighted the continued strong performance of Amazon’s rapidly expanding advertising business, which saw a 27% increase in sales to $14.7 billion.

For the current quarter ending in March, Amazon expects sales growth of up to 13%. The company also anticipates a significant increase in operating profits, estimating a rise from $4.8 billion to between $8 billion and $12 billion.