Online retailer Amazon posts profits of US$3.2 billion for the March Quarter

Amazon has a lot to smile about as winter turns into spring.

For the first three months of this year, it reported sales of US$127.4 billion, generating a profit of $3.2 billion.

In the same period last year, Amazon reported a loss of US$3.9 billion.

This quarter’s performance was better than expected and comes as the online retail giant takes a cautious approach with rising inflation and an anaemic world economy.

Amazon has fared better than many tech companies and seems to be prospering this year while Meta is having a hard time of it.

Amazon’s Web Services sales rose by 16 per cent for the quarter under review  to $21.35 billion. This was still less than the prior quarter when sales grew by 20 per cent.

While advertising revenue climbed to $9.5 billion, there has been a fall-off in cloud spend as companies cut back.

“Our advertising business continues to deliver robust growth largely due to our ongoing machine learning investments that help customers see relevant information when they engage with us which in turn delivers unusually strong results for brands,” said Amazon’s CEO Andy Jassy.

Amazon’s Chief Finance Officer Brian Olsavsky addressing the uptick in advertising revenue added: “ Advertising was a strong growth during the quarter at 23 per cent and that is coming to hold up very well in an environment where perhaps the underlying sales of products is slowing.”

What is remarkable about Amazon’s March performance is that consumer habits are returning to normal with people again hitting the high streets and relying less on online purchasing.

While other online companies have suffered having to contend with the end of the COVID lockdowns, Amazon has staged a recovery from last year’s set back.

Under Andy Jassy’s management, the company has placed kept a keen eye on U.S. consumer spending patterns and moved to keep its overheads low.

Amazon is laying off as many as 27,000 workers and is looking to operate its business across the world with 1.46 million employees-for now.