Amazon sets growth accents with impressive Q3 results and AI investments

Amazon surprised in the third quarter of 2024 with earnings of $1.43 per share, surpassing analysts' expectations by a remarkable 25.44%. The tech giant's profit rose by 52.1% compared to the previous year, resulting in a net income of $15.3 billion. Revenue also performed well: at $158.8 billion, Amazon exceeded both its own forecast and market observers' expectations. This growth was primarily driven by the success of Amazon Web Services (AWS), where investments in generative AI models provided additional momentum. In North America and internationally, Amazon also showed positive revenue development, supported by the growing advertising business. AWS additionally focused on expanding services for the use of artificial intelligence on its platform. Innovative initiatives such as the introduction of new AI models and collaboration with Databricks highlight Amazon's strategy to solidify its market position in the AI and cloud sector. The partnership with Oracle underscores efforts to offer customers customized solutions that enable seamless migration to AWS. However, Amazon also sees challenges on the horizon. Geopolitical tensions, exchange rate risks, inflation concerns, and labor market conditions in various regions cast shadows on otherwise positive developments. Nevertheless, the company remains optimistic and continues to invest in its global capacities. Product sales rose by 7% to $67.6 billion, while service sales increased by 14.2% to $91.2 billion. Regionally, Amazon grew by 8.7% to $95.5 billion in North America, while international sales increased by 11.7% to $35.8 billion. AWS achieved revenue of $27.4 billion, representing a 19.1% increase. Strengthening relationships with major enterprise clients has also paid off. New agreements include partnerships with renowned companies such as Capital One, Epic Games, and Toyota. In addition, AWS plans significant investments in the United Kingdom to support the local labor market. Amazon's third quarter was further complemented by strong growth in the advertising sector and physical retail stores, with online segment sales rising by 7% to $61.4 billion.