Strong retail performance highlight of Amazon results

Robert Stockdill

7th Feb 2025

Amazon’s retail business helped offset weakness in the company’s AWS cloud division during the fourth quarter, with online sales up 7 per cent to $120.165 billion (US$75.56 billion).

Overall revenue reached $298.7 billion (US$187.8 billion), while net income nearly doubled to $31.8 billion ($20 billion) from $16.86 billion ($10.6 billion) a year earlier.

Advertising sales rose 18 per cent to $27.5 billion ($17.3 billion).

However, the company’s cloud computing unit, AWS, underperformed against market expectations, growing by 19 per cent to $45.79 billion ($28.79 billion), marginally short of market expectations. That fuelled a 5 per cent decline in Amaozn’s share price on Thursday, erasing about $143 billion ($90 billion) worth of stock market value. The share price recovered to be down by about 4.2 per cent late in the day.

CEO Andy Jassy said the inconsistent flow of computer chips had held back some growth in AWS. “We could be growing faster, if not for some of the capacity constraints, and they come in the form of chips from our third-party partners coming a little bit slower than before,” he told investors on a conference call.

Amazon CFO Brian Olsavsky expected this year’s capital expenditure run rate to be roughly the same as last year’s fourth quarter when the company spent $41.8 billion ($26.3 billion). Amazon has boosted spending, in particular, to help develop artificial intelligence software.

Competitors Microsoft and Google’s parent Alphabet posted slow cloud growth in last year’s fourth quarter, sending lower shares. The companies and Meta Platforms said costs to develop infrastructure for artificial intelligence software contributed to sharply higher anticipated capital expenditures for 2025, a total of around $366 billion ($230 billion) between them.

• Additional reporting by Greg Bensinger and Deborah Mary Sophia of Reuters.