Amazon enjoys best ever year with record profits and sales

amazon update

Amazon has enjoyed its best-ever financial year, with quarterly profits almost reaching the $2 billion mark for the first time.

The online retail giant said its net income more than doubled to $1.9 billion (£1.3 billion) in its fourth quarter, compared to $749 million recorded in the same period in 2016 – making it its biggest recorded profit ever.

Meanwhile, operating income skyrocketed by 69 per cent to $2.1 billion (£1.4 billion) in the fourth quarter, compared with operating income of $1.3 billion in fourth quarter of 2016.

Net sales also hit a record $60.5 billion (£42.5 billion) – a 38 per cent uptick – boosted by the acquisition of the Whole Foods grocery retailer last year, which added $4.5 billion (£3.1 billion) to its top line.

Amazon said its fourth quarter included a provisional tax benefit for the impact of the US Tax Cuts and Jobs Act of 2017 of approximately $789 million.

On a full-year basis, the Seattle-based retailer said net sales surged 31 per cent to $177.9 billion (£125 billion), compared with $136 billion in 2016.

However, operating income slipped by two per cent to $4.1 billion (£2.9 billion), compared with operating income of $4.2 billion recorded for 2016.

Net income at the end of the year stood at $3 billion (£2.1 billion), compared with net income of $2.4 billion in 2016.

Amazon doesn’t usually break down its sales per category, but chief executive Jeff Bezos said a lot of the recent growth has to do with the rise of Alexa adoption in recent years.

Other attributes that boosted Amazon’s record year includes a surge in Prime membership, and how its Fire TV Stick and the Echo Dot were its best-selling products.

“Our 2017 projections for Alexa were very optimistic, and we far exceeded them,” he said.

“We don’t see positive surprises of this magnitude very often — expect us to double down.

“We’ve reached an important point where other companies and developers are accelerating adoption of Alexa.

“There are now over 30,000 skills from outside developers, customers can control more than 4000 smart home devices from 1200 unique brands with Alexa, and we’re seeing strong response to our new far-field voice kit for manufacturers.”

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