How Is Amazon Performing In India?

Amazon (Nasdaq: AMZN) reported a mixed third quarter last week. For the second straight quarter, it missed estimates of revenue while earnings estimates blew past estimates. International sales have also seen a slowdown due to late onset of Diwali this year. This was the fourth straight quarter of profit above $1 billion, but the volatile market has been unforgiving.

Amazon’s Financials

Amazon’s third quarter revenues grew 29% to $56.6 billion, missing the market’s expectations of $57.10 billion. Net income increased over 11 times to $2.9 billion or $5.75 per share from $256 million or $.52 per share a year ago, blowing past analyst expectations of $3.14.

Operating income increased to $3.7 billion, compared with $347 million a year ago. The company ended the quarter with cash balance of $21 billion. Its workforce increased 51% y-o-y to a record-high 613,300 employees.

By segment, net product sales increased 17% to $33.7 billion and net service sales increased 52% to $22.8 billion.

AWS revenues grew 46% over the year to $6.68 billion, missing estimates of $6.71 billion. AWS generated operating income of $2.1 billion.

Revenue from subscription services like Prime increased 52% to $3.7 billion. Revenue from online stores grew 10% to $29.1 billion while revenue from physical stores, chiefly from its stores from the Whole Foods acquisition, was $4.3 billion. Revenue from third party seller services including commission, fulfillment, and shipping fees grew 31% to $10.4 billion.

Other revenue mainly from advertising grew 122% to $2.5 billion. Despite the astronomical increase, Amazon still has a long way to go before it catches up with advertising leaders Google and Facebook. Alphabet recently reported a 20.3% increase in its Q3 advertising revenues to $28.95 billion.

Amazon’s international sales grew 13% to $15.5 billion, compared to a y-o-y growth rate of 29% a year ago. However, losses narrowed from $936 million to $385 million while North America reported operating income of $2.03 billion, up 1700%.

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