Amazon £3bn profit smashes records again

AMAZON shares surged in after-hours trading last night after the internet giant’s profits smashed Wall Street’s predictions.

The US firm said earnings more than doubled to a record £2.8bn in the first three months of the year – far above analyst forecasts of £1.8bn.

it came despite the US tech company reporting its slowest sales growth in four years, with revenue for the quarter rising 17pc to £46.3bn. The bonanza came off the back of its lucrative cloud computing and advertising businesses, which are significantly more profitable than its other businesses.

AWS, which provides data storage, website hosting and a host of other digital services to companies around the globe, saw sales soar 41pc to £6bn.

And Amazon said sales at its ‘other’ businesses – largely made up of advertising – rose 34pc to £2.1bn.

Shares in after-hours trading were up by nearly 2pc as investors cheered the results. Analysts said the company was now entering a period of slower growth, but the trade- off would be fatter profits.

‘it appears that sub-20pc growth might be the new normal,’ Canaccord Genuity wrote in a note to investors earlier this week.

‘Looking ahead we expect steady, albeit more moderate growth, with continued margin progress.’

Amazon’s hefty spending also rose 12.6pc in the quarter to £42.9bn as it invested in electric car maker Rivian and self- driving car startup Aurora.

The firm continued to pump money into its Prime video services as well, which it uses to attract more shoppers to its website, and grocery delivery services from Whole foods stores.

Brian Olsavsky, the company’s finance chief, had previously warned Amazon was preparing to ramp up its spending this year.