Amazon Shares Jump After Hours On Better-Than-Feared Q2 Results – Deadline


Amazon swung to a net loss of 20 cents in the second quarter compared with earnings of 76 cents in the year-ago period, but revenue rose a better-than-expected 7% to $121.2 billion.

Investors rewarded the beleaguered stock of the tech giant in after-hours trading, sending it up 11%. The markets had been bracing for worse news from the company.

Wall Street analysts had been looking for earnings of 13 cents and revenue of $119.09 billion.

Advertising services, a burgeoning category as the company pushes into live sports and non-subscription streaming, registered an 18% upturn compared with a year ago, reaching $8.757 billion. The line item, which encompasses e-commerce, audio and other areas of the empire along with video, is now the fourth-largest revenue category after online retail, third-party sellers and Amazon Web Services.

Asked during a conference call with analysts about macroeconomic issues crimping the ad business (as Roku, Twitter and other digital players have reported in recent days), execs said they saw no signs as of yet. But they also asserted that Amazon is unique given its status as a place where “people have their credit cards out” when interacting with the company’s advertising offerings.

As the coronavirus pandemic began sweeping around the world in early 2020, Amazon proved to be one of the chief corporate beneficiaries. Even though its operations were initially strained, after a few months it boosted resources and closed out the year on a major upswing and then continuing the momentum in 2021. Results in the first quarter, however, reflected both difficult comparisons with a singular boom time and also the grueling economic conditions facing a number of large companies, especially in the tech sector.

Even though this quarter’s results marked an improvement, the subdued performance shows the continued overhang of the pandemic. It has been a little more than a year since Andy Jassy took the baton from Jeff Bezos and became CEO and the going has been bumpy. There has been turnover in the senior ranks and the company has seen its long-potent stock fade, not long after a 20-for-1 split took effect last spring. The stock fell 35% in the second quarter, its steepest decline since 2001. A sudden rise in inflation in the U.S. and other parts of the world has presented complex challenges.

“Despite continued inflationary pressures in fuel, energy, and transportation costs, we’re making progress on the more controllable costs we referenced last quarter, particularly improving the productivity of our fulfillment network,” Jassy said in the company’s earnings release. He also pointed to two September events: the kickoff of exclusive, live Thursday night NFL streams and the premiere of long-anticipated fantasy series The Lord of the Rings.

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