Dive Brief:
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Amazon smashed analysts' expectations, bringing in better-than-anticipated first quarter earnings on Thursday.
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Revenue was up 28% over last year, driven primarily by the strength of Amazon Web Services (AWS), the company’s cloud business.
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AWS is currently the most profitable business at Amazon, according to Yahoo Finance. In total, AWS was responsible for 56% of the entire company’s profit in Q1.
Dive Insight:
AWS revenue was $2.57 billion, beating estimates of $2.53 billion. That’s up 64% from the first quarter of 2015. Its operating income is up 170%.
Analyst Jan Dawson noted on Twitter that AWS generated more operating income in the quarter than Amazon's entire U.S. e-commerce business.
This is Amazon’s fourth profitable quarter in a row. The company’s stock surged more than 11% in after-hours trading following the report.
Though Microsoft and Google have been stepping up efforts to catch AWS, the company has a firm grasp on its lead. Last year, Amazon held 31% of the cloud market. Microsoft, IBM and Google each held 9%, 7% and 4%, respectively.
