Giant E-commerce platform,Amazon.com Inc (AMZN.O) more than doubled its profit last week, and predicted strong spring results as the world’s biggest online retailer raised the price for U.S. Prime subscribers, added U.S. football games and touted its cloud services for business.iiiiii
The results showed the broad strength of the company, which has been expanding far beyond shipping packages, the business that has drawn the ire of U.S. President Donald Trump.iiiii
The forecast beat expectations on Wall Street, sending shares up 7 percent to a new record high in after-hours trade and adding $8 billion to the net worth of Jeff Bezos, Amazon’s chief executive and largest shareholder.ii
Sales jumped 43 percent to $51.0 billion in the quarter, topping estimates of $49.8 billion, according to Thomson Reuters I/B/E/S.
Amazon’s fast ascent has made it a lightning rod for the ire of Trump. Bezos privately owns the Washington Post, which Trump has described as Amazon’s “chief lobbyist.” Bezos has no involvement in news coverage, the paper’s top editor has said. Trump has also claimed without evidence that Amazon is costing the U.S. Postal Service money and ordered a task force to investigate.
Prime, Amazon’s loyalty club that includes fast shipping, video streaming and other benefits, has been key to Amazon’s strategy. Its more than 100 million members globally spend above average on Amazon.
The company announced Thursday it will increase the yearly price of Prime to $119 from $99 for U.S. members this spring. The fee hike is expected to add a windfall to Amazon’s subscription revenue, already up 60 percent in the first quarter at $3.1 billion.
Revenue from third-party sellers paying to promote their products on Amazon.com was an unusually large bright spot during the quarter, with sales in the category, which includes some other items, growing 139 percent to $2.03 billion. This included $560 million from an accounting change.
Amazon said it expects operating profit this quarter between $1.1 billion and $1.9 billion, up from $628 million a year earlier. Analysts were expecting $1.01 billion, according to analytics firm FactSet, Reuters reports.
