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Amazon’s profit and sales skyrocket in Q1

Amazon reported huge sales and profit surges in the first quarter, increases that were fueled by its fast-growing cloud services business (AWS) and Prime loyalty members.

For the quarter ended March 31, net income was $1.6 billion, or $3.27 per share, compared with net income of $724 million, or $1.48 per share, in first quarter 2017. This beat analysts’ expectations of $1.26 per share.

Net sales increased 43% to $51.0 billion, compared with $35.7 billion a year ago.

Operating income increased 92% to $1.9 billion in the first quarter, compared with $1.0 billion in last year’s first quarter.

Prime memberships contributed to Amazon’s jump in revenue. Members — which are more than 100 million globally — spend above average on Amazon. Sales from Prime fees and other subscriptions grew 60% to $3.1 billion.

AWS, which handles data and computing for large enterprises in the cloud, also increased its profit for the quarter. The division reported $5.44 billion in sales, a 49% increase. This beat analyst estimates of $5.25 billion.

“AWS had the unusual advantage of a seven-year head start before facing like-minded competition, and the team has never slowed down,” said Jeff Bezos, Amazon founder and CEO.

Looking ahead to the second quarter, net sales are expected to be between $51.0 billion and $54.0 billion. This growth will range between 34% and 42% over the second quarter of 2017. This guidance is based on the fact that no additional business acquisitions, investments, restructuring, or legal settlements will take place.
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