Amazon (AMZN) Q3 earnings report 2023

Amazon reported third-quarter earnings and revenue on Thursday that sailed past analysts’ estimates. The stock climbed in extended trading.

Here are the results:

• Earnings per share: 94 cents vs. 58 cents expected by LSEG, formerly known as Refinitiv.
• Revenue: $143.1 billion vs. $141.4 billion expected by LSEG.

Investors are also following these segment numbers:

• Amazon Web Services: $23.1 billion vs. $23.2 billion in expected revenue, according to StreetAccount
• Advertising: $12.1 billion vs. $11.6 billion in expected revenue, according to StreetAccount

Amazon said fourth-quarter sales, which include the key holiday period, will be between $160 billion and $167 billion. Analysts were expecting revenue of $166.6 billion, according to LSEG. At the mid-point of its guidance range, revenue of $163.5 billion would represent growth of 9.6% from $149.2 billion a year earlier.

Revenue jumped 13% in the third quarter, a sign that the business is seeing some acceleration after a difficult 2022 that was marred by soaring inflation and rising interest rates.

Amazon has been in cost-cutting mode for the past year as it became clear that it expanded too quickly during the pandemic. The company has laid off 27,000 employees since last fall, and it’s axed some of its more unprofitable bets.

CEO Andy Jassy, who succeeded founder Jeff Bezos at the helm in mid-2021, said those belt-tightening efforts continue to bear fruit.

“We had a strong third quarter as our cost to serve and speed of delivery in our Stores business took another step forward, our AWS growth continued to stabilize, our Advertising revenue grew robustly, and overall operating income and free cash flow rose significantly,” Jassy said in a statement.

Sales in Amazon’s core e-commerce business continued to recover, expanding 7% year over year, after growing 4% in the previous quarter. The September quarter includes the results of this year’s Prime Day promotion, which took place in July. Amazon described it as its “biggest ever” sale.

Net income more than tripled to $9.9 billion, or 94 cents a share, from $2.9 billion, or 28 cents a share, a year earlier. Net income for the quarter includes pre-tax valuation gain of $1.2 billion from the company’s investment in electric car company Rivian.

Amazon’s results follow better-than-expected numbers from Alphabet and Meta earlier this week. However, shares of both of those companies fell after their earnings reports. Alphabet investors were concerned about disappointing revenue in the Google Cloud division, while Meta’s sell-off resulted from cautionary comments regarding the ad market in light of the escalating conflict in the Middle East.

Amazon shares fell more than 6% over the past two trading days, as the response to Alphabet and Meta’s numbers hit their mega-cap tech peers.

Digital advertising continues to be a bright spot for Amazon, as third-party sellers and large brands bolster their ad spending to improve visibility in an increasingly competitive…