Amazon Web Services contributed more than half of the operating profit

Amazon’s expansive list of highlights that contributed to record fourth-quarter profits is a handy reminder of its various interests. Alongside the grocery chain Whole Foods and its cloud computing service Amazon Web Services, the company gave a shout out to businesses as disparate as Amazon Fashion, Amazon Studios, the doorbell detector Ring and the delivery network Amazon Air. The thread that connects this discordant group is subscription service Prime… AWS remains the pick of the bunch. Its revenues made up about a tenth of the total $72 billion yet contributed more than half of the group’s total operating profit… Pivoting into physical stores through Whole Foods and Amazon Go has admittedly not provided the same sort of high-margin business as advertising or cloud computing. Revenue of $4.4 billion was 3 per cent below the same period last year, although Amazon explained that miss as differences in the lengths of each quarter. Similar accounting tweaks are held partly accountable for total revenue growth of 20 per cent — the slowest recorded in almost four years. That is admittedly unimpressive for a company that trades at a throat-catching 65 times earnings… But slower revenue growth is fine so long as Amazon can keep growing margins. Everything in this set of results suggests that it can.
 
Lex.

Food4Brains

SUBSCRIBE and RECEIVE your DAILY BRAIN FOOD!