Amazon’s first-quarter earnings report for 2023 has shown that the online retail giant has beaten earnings expectations. The report revealed that Amazon recorded a profit of $3.2 billion on revenue that climbed 9 percent to $127.4 billion. Amazon shares spiked more than 10 percent shortly after the earnings report was released, only to sink slightly below the day’s closing price as the company warned that customers were remaining watchful of their budgets.
According to the report, Amazon’s cloud and ads units were the primary drivers of the strong earnings. Amazon’s CEO, Andy Jassy, stated that there was a lot to like about how their teams were delivering for customers, particularly amidst an uncertain economy. He also noted that Amazon’s Stores business was improving the cost to serve in their fulfillment network while increasing the speed with which products are delivered.
However, in March 2023, Jassy laid out a plan to cut 9,000 more jobs from Amazon’s workforce, following the 18,000 that were axed in January. The layoffs are part of Amazon’s plan to downsize after years of hiring, particularly during the coronavirus pandemic when people turned to the Internet for shopping.
Amazon’s robotic system called “Robin” handled over a billion packages in North America and Europe during the quarter. Robin uses computer vision and artificial intelligence to help workers sort and handle packages being shipped to Amazon customers, according to the company.
The AWS cloud computing unit’s revenue climbed 16 percent to $21.4 billion, but operating income was lower due to higher costs. Despite this, Amazon’s stronger-than-expected performance for AWS and advertising indicate that the enterprise and digital ad sectors may be turning the corner.
In related news, Microsoft’s Q1 2023 results pleased investors, lifted by its industry-leading business cloud products. The company reported that revenue from Cloud and AI offerings more than offset drops in money made from licensing Windows software to computer makers, as sales suffer in that market. Google parent Alphabet’s cloud computing business also turned a profit for the first time, beating market expectations in the first quarter of 2023.
Finally, Microsoft-backed ChatGPT went viral last year, and the company has added the technology to Bing’s search engine and office software. Google released Bard, its own version of the language-based AI, which has disappointed observers and company insiders.
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For Digital Products and Services: Maurisys Software.
