AMAZON TROUNCES APPLE AND GOOGLE
£125bn SALES iPHONE WOES £7.7bn TAX HIT
AMAZON revealed a £125bn sales bonanza that left its rivals in the shade as three of Silicon Valley’s titans posted results.
Jeff Bezos’ internet shopping firm made more than £42bn in the last quarter of 2017– more than £460m a day.
It was the star performer as Apple and Google’s parent company, Alphabet, also revealed earnings.
The three firms have been in a race to become the world’s first ever $1 trillion company. With Apple trading at $860bn yesterday morning, Amazon at around $700bn and Alphabet at $817bn.
Together the companies reported a staggering £127bn in sales for the three months to the end of December.
Amazon was helped with eyecatching products featuring its voice assistant, Alexa, as well as its cloud computing division.
Bezos, the world’s richest man, has turned Amazon into a powerhouse.
In 2017 it shipped five billion items on its Amazon Prime service and said sales of its Alexa voice- controlled speaker had been even better than expected.
Bezos said it would now ‘double down’ on the product, adding: ‘We don’t see positive surprises of this magnitude very often.’
By contrast, Apple saw a share sell- off after the market closed when it revealed iPhone sales had missed targets.
Retailers have said the £999 iPhone X has not been as popular as previous models so far. As a result, sales were 77.3m units as opposed to estimates of more than 80m. It did post its biggest quarterly revenues ever, at £61.9bn. It made profits of £14.1bn.
Boss Tim Cook tried to look on the bright side declaring it the top- selling iPhone since it launched.
He said: ‘We’re thrilled to report the biggest quarter in Apple’s history, with broad-based growth that included the highest revenue ever from a new iPhone line-up.’
The company, which employs 6,500 people in the UK, sold 5.1m Mac computers and more than 13m iPads during the period.
Its shares dived 2pc in after- hours trading, although some of the losses were tempered as its profitability improved. Alphabet, the owner of Google, saw its shares slump more than 5pc in after-hours trading as its earnings disappointed investors.
Revenues were £22.7bn for the fourth quarter of 2017, but it also declared taxes of £7.7bn because of Donald Trump’s new income tax rules in the US.
The growth in revenue of 24pc was faster than in the previous year. But missing earnings expectations was enough to worry investors. For the entire year, Alphabet posted sales of £77.7bn, up by more than £14bn on previous years.
Other measures of its performance had also been encouraging with the total number of paid clicks – that is the internet links which earn the firm money – rising to 43pc.