Is Amazon a Good Stock to Buy? Amazon Reports Strong Q2 Results. Here Is Why.

Aug 18, 2023

Is Amazon a Good Stock to Buy? Amazon Reports Strong Q2 Results. Here Is Why.

Amazon’s impressive second-quarter results and outlook for the third quarter have made it an attractive stock to consider for investors. The company posted better-than-expected sales and earnings and offered guidance that exceeded Wall Street estimates. This has sparked much debate about the question: “Is Amazon a good stock to buy?“

Also, Amazon Web Services, a subsidiary of the company, experienced better-than-expected growth in the quarter.

Amazon stock (AMZN) was up 9.6% on August 4th after the earnings disclosure, which was particularly noteworthy given that shares had already gained about 60% this year. Following AWS’s good results, several cloud-related software businesses rallied, with Datadog (DDOG) up 6.5%, Snowflake (SNOW) up 5.6%, and MongoDB (MDB) up 3.5%.

Also, Amazon Web Services, a subsidiary of the company, reported second-quarter earnings that exceeded analysts’ expectations, indicating that the deceleration of growth in cloud spending may be coming to an end.

During a call with analysts, Amazon CEO Andy Jassy spoke about how the June quarter saw customers continuing to optimise their spending while also putting more effort into driving innovation and introducing new workloads onto the cloud. He went on to say that as a result of these efforts, AWS revenue growth had “stabilised” in the quarter.

The CEO noted that the cost optimizations were moderating and, in some cases, may have come to an end for their major customers. He added that they were starting to see more progress with new workloads and business being implemented.

Jassy also remarked that AI workloads could take some time to contribute significantly to revenue growth.

Amazon disclosed second-quarter sales of $134.4 billion, up 11% year on year and above the company’s estimated range of $127 billion to $133 billion as well as the Wall Street consensus of $131.2 billion. Profits per share were 65 cents, much above the Street’s projection of 35 cents.

Operating income was $7.7 billion, more than double the $3.3 billion recorded in the previous quarter and much above the company’s projection range of $2 billion to $5.5 billion. AWS sales were $22.1 billion, up 12% and two percentage points more than Wall Street expectations.

Online store sales were $53 billion, up 4% year on year, falling short of the Wall Street prediction of 6.5% growth, but third-party services exceeded, with revenue of $32.3 billion, up 18% year on year, above the Street forecast of 13% increase.

Advertising revenue was $10.7 billion, up 22% and approximately $400 million more than the average forecast, while subscription revenue, mostly Amazon Prime, was $9.9 billion, up 14% and slightly ahead of expectations.

Amazon expects sales of $138 billion to $143 billion in the third quarter, up 9% to 13% year on year. That’s several billion dollars more than the consensus of $137.5 billion. According to the company, the prediction includes a 120 basis point positive effect from foreign currency rates. Operating income for the quarter is expected to range between $5.5 billion and $8.5 billion, according to the business.

Jassy shared Amazon Web Services’ AI capabilities during the call. He mentioned that Trainium, a custom training chip for AI, was released several years ago, as well as Inferentia for inference tasks. The CEO expressed his hope that many large language model training will be done using AWS’ Trainium and Inferentia chips in the future.

Amazon CFO Brian Olsavsky mentioned that Amazon’s capital expenditure would be lower this year than it was in 2022, at around $50 billion instead of the $59 billion from last year. The decrease has been attributed to a decline in fulfilment and transportation capital expenditures, although investment in AWS infrastructure, such as AI projects, is expected to increase.

In a statement, Jassy highlighted Amazon’s progress in the quarter. “Amazon was able to lower its cost to serve and provide Prime customers with some of the fastest delivery speeds ever recorded,” he said.

Compared to a year ago, Amazon’s employee headcount fell 10%, and it has declined 16% over the last five quarters.So, is Amazon a good stock to buy? The answer to that question is ultimately up to the individual investor, but the company’s financial performance and guidance suggest that Amazon is well-positioned for strong growth this quarter.

Subscribe Our Newsletter

Nvidia Q2 Earnings 2024

Otar

Nvidia Q2 Earnings 2024: Strong Revenue Growth and Forecasts Despite Stock Dip

Nvidia's Q2 2024 report shows $30B in revenue and a 168% earnings increase. Despite a 6% stock dip, forecasts suggest a $362 price target by 2030.

Companies
Tesla Stock Is Down. Don’t Blame Cybertruck.
Tesla Stock Is Down. Don’t Blame Cybertruck.

The shares of Tesla are down a little on Wednesday. A story from The Verge said that Tesla had omitted a few important digits from their Cybertruck homepage, which may be the reason. That disclosure, on the other hand, is no longer news.

Companies
Get the ultimate solution: B2BinPay Get the ultimate solution: B2BinPay
Sponsored
Constantine

Complete Guide to the Over-the-Counter (OTC) Market
Learn about what OTC markets are, how they work, and what types of financial instruments are traded in such markets.

discover
ETF liquidity_ looking for a trustworthy provider.

Liquidity Provider

ETF liquidity: Looking for a Trustworthy Provider

Let's find out what are ETF funds and investment instruments, who are ETF Liquidity Providers and what are key criteria of a reliable ETF Liquidity Provider.

Liquidity
Contact us bg

Contact Us

Contact the Liquidity Provider
for any questions and advertising inquiries

    Please fill out this contact form to get in touch with us

    / 3000

    By clicking “Get in touch” button, you agree to the privacy policy

    Successful!
    Thank you for your request.
    We will contact you shortly.
    Close

    Constantine

    Triple Net Lease: Meaning, Benefits, and Strategies Explained

    Constantine

    Hanging Man Pattern: How to Identify and Trade It Effectively

    Hanging Man Pattern

    Alex

    5 Infinite Banking Mistakes That Could Cost You Thousands

    Infinite Banking Mistakes to Avoid

    Aleksander

    Solana Firedancer: Solving Solana’s Biggest Problems with a New Engine

    Solana Firedancer explained

    Alexander

    What Is an Interest Coverage Ratio? How to Use This Financial Metric to Evaluate Company Health

    Interest Coverage Ratio Explained

    Hazem

    After-Hours Trading: Can You Trade After Financial Markets Close?

    After-Hours Trading Explained

    Alexander

    How to Scale a Crypto Exchange Business and Stay Competitive

    how to scale crypto exchange business

    Constantine

    Crypto CrypticStreet Review: The Future of DeFi and Secure Crypto Trading

    Crypto CrypticStreet Review: The Future of DeFi and Secure Crypto Trading

    Alexander

    Bitcoin Power Law Explained: How It Shapes BTC’s Long-Term Growth

    Bitcoin Power Law Explained: How It Shapes BTC’s Long-Term Growth

    Hazem

    Megaphone Pattern​: What Is It? How to Use It In Trading

    Megaphone Pattern​: How to Read & Trade with It

    Constantine

    Top 5 Liquidity Bridge Providers in DeFi

    Top 5 Liquidity Bridge Providers in DeFi

    Hazem

    Max Funded IUL Explained: Is It a Legitimate Financial Strategy?

    Understanding Max Funded IUL

    Alexander

    Tax Refund Timeline: When Will You Get Your Tax Return?

    how long does it take for tax refund

    Constantine

    Crypto Liquidity — What is it, and How to Measure It?

    What is Crypto Liquidity and How to Measure It?

    Constantine

    AI in Finance: A Game-Changing Trend Shaping the Industry

    AI in Finance

    Hazem

    5 Ways to Make Money with ChatGPT and Build Your Wealth

    Make Money with ChatGPT

    Constantine

    Top AI Companies to Invest in April 2025

    Top AI Companies to Invest in March 2025

    DeepSeek vs ChatGPT: Which AI Technology is Better For You?

    DeepSeek vs ChatGPT: Feature-by-Feature AI Tool Comparison

    Constantine

    Top Solana Meme Coins in 2025: Best Presales and Where to Buy

    Solana Meme Coins 2025

    Alexander

    How Renewable Energy Stocks Can Supercharge Your Portfolio

    How Renewable Energy Stocks Supercharge Your Portfolio

    SEC Crypto Regulations: What Financial Advisors Need to Know

    SEC Crypto Regulations: Insights for Financial Advisors

    Hazem

    The Cup and Handle Pattern – How Trade Using This Bullish Indicator?

    Cup and Handle Pattern – How to Predict Price Breakouts?

    Hazem

    Year-Over-Year (YoY): What It Means? How It’s Used in Finance?

    Year-Over-Year (YoY): How to Calculate Business Performance?

    Constantine

    What is WAGMI and NGMI? Understanding Crypto Slangs

    WAGMI vs. NGMI
    liquidity-provider-logo
    • News
      • Stock Market Forecast
      • Stocks
      • Banks and Finance
      • Companies
      • Crypto
      • Forex
      • AI
      • Technology
      • DeFi
      • NFT
    • Articles
      • Crypto Payments
      • Trading
      • Crypto Exchange Business
      • Forex Business
      • Fintech
      • Liquidity
      • FinTech Awards
      • Blockchain
      • Investing
      • NFT
      • DeFi
    • More
      • Videos
      • Liquidity Providers List
      • Crypto Payment Providers
      • White Label Brokerage Platforms
      • Broker CRM Platforms
    [email protected]

    © 2024 Liquidity Provider. All Rights Reserved

    Privacy Policy Cookie Policy
    This site is registered on wpml.org as a development site. Switch to a production site key to remove this banner.