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Amazon doubled its net income in the second quarter of 2024 to $13.5 billion, which it attributed largely to growth in its cloud-based Amazon Web Services (AWS). Net sales for its subscriptions services segment, which includes Prime Video, grew 10% to $10.87 billion in the quarter.
Here are the top-line results:
Net income: $13.49 billion, up 99% from $6.7 billion a year ago.
Earnings per share: $1.26 per share, compared to $1.05 expected by analysts surveyed by Zacks Investment Research.
Revenue: $148 billion, up from $134.4 billion last year, compared to $148.6 billion expected by analysts surveyed by Zacks Investment Research.
Shares of Amazon, which reported its results after the bell on Thursday, climbed more than 7% in after-hours trading. As of Thursday’s close, the Amazon’s stock price was up 23% this year.
CEO Andy Jassy noted Amazon’s 11-year deal to secure the media rights for the NBA and WNBA, but most of Thursdays’s earnings presentation focused on AWS and AI.
North American segment sales for AWS were $90 billion, a 9% year-over-year increase. Sales for the international segment also increased by 7% over the same time period, clocking in at $31.7 billion. When accounting for changes in foreign exchange rates, the year-over-year increase was closer to 10%. Total segment sales for the period were a reported $26.3 billion, a 19% increase compared to Amazon’s second quarter in 2023.
Amazon’s subscriptions segment also saw growth. That division includes annual and monthly fees associated with Amazon Prime memberships as well as digital video, audiobook, digital music, e-book and other non-AWS subscription services.
“We’re continuing to make progress on a number of dimensions, but perhaps none more so than the continued re-acceleration in AWS growth,” Andy Jassy, president and CEO of Amazon, said in the second quarter earnings letter.
Jassy said that AWS continues to be a “top choice” as companies continue to modernize, move to the cloud and explore opportunities using Generative AI. He pointed to four AI tools as being beneficial to the growth of AWS: SageMaker, a cloud-based machine-learning platform that was designed for model builders; Bedrock, a tool that connects AWS users to foundation models from leading AI companies like Meta; Trainium, a machine-learning chip that is built for deep learning training and serves as a more affordable option for customers; and Q, Amazon’s GenAI assistant for developers.
“The reality right now is that, while we’re investing a significant amount in the AI space and infrastructure, we would like to have more capacity than we already have. We have a lot of demand right now, and I think it’s going to be very, very large business for us,” Jassy said.
AI has been a major factor during this round of earnings. Last week, Alphabet reported growth through Google’s implementation of AI Overview, which provides its search users near-instant answers to their queries based on sources from around the web. This consumer-facing use of AI has increased engagement from users 18 to 24 years old. The company also announced it would be launching new ways to incorporate AI into search, including the introduction of a VR lenses and new features for Gmail and Google Photos.
As for Apple, the tech giant introduced Apple Intelligence last quarter. The upcoming personal intelligence system will put private generative AI models into the company’s iPhone, iPad and Mac products.
Amazon executives also mentioned Prime Video ads, which launched this year, as a sponsor product that is driving growth. At its launch in January, Prime Video estimated that its ads would reach 115 million monthly viewers in the U.S. This year also marked the first time Amazon attended the upfronts in New York, a series of presentations catered to potential advertisers.
