Amazon exceeded Wall Street’s outlook for the holiday season by posting what turned out to be its most profitable season ever as it announced earnings for the fourth quarter.
The company recorded nets sales of $60.5 billion for Q4 of 2017, rising 38 percent from 2016. The sales did not disappoint in the profit area scooping $1.9 billion for the online retail giant representing $3.75 per share. This is compared to a profit of $749 million for the same period in 2016.
The figures released by Amazon indicate that for fiscal 2017 the company made profits of $3 billion with more than 60 percent of it generated in the fourth quarter. This was generated from sales of $177.9 billion, a growth of 31 percent. The holiday season therefore represents Amazon’s most productive period and will remain significant in the company’s calendar.
Amazon’s CEO Jeff Bezos attributed the success to the expansion of the company’s digital assistant Alexa. He said Alexa has amassed 30,000 skills and that these voice-activated capabilities have captured the attention of consumers.
Bezos added that the company surpassed its own expectations for last year and felt that the company is at a critical point in the adoption of Alexa as more developers come on board to expand the digital assistant’s skills and companies integrate these capabilities into their devices. He noted that over 4,000 smart home devices from 1,200 different brands can be controlled using Alexa even as more manufacturers embrace the company’s new far-field voice kit. The CEO promised that efforts around Alexa will be increased multiple times in line with the growth prospects exhibited by the digital brain.
Apart from Alexa, another big contributor to Amazon’s profits is Amazon Web Services. The cloud service provider recorded $5.1 billion in sales for Q4, an increase of 44 percent over the same period in 2016. AWS also surpassed revenues for 2016 by bringing in $17.4 billion last year representing an increase of 43 percent.
2017 was therefore a significant year for Amazon. The company shipped over 5 billion items using its Prime program last year with more than 4 million people signing up in just one week during the holidays. These sign-ups could be either through fully paid memberships or free trials.
In terms of devices the Fire TV Stick and the Echo Dot were the top selling items for the company. Amazon reported that it shipped tens of millions of Alexa-enabled devices indicating that there was a considerable rise from the year before.
Amazon’s growth was not limited to products and services only but extended to employees too. At the end of last year, the company employed 566,000 people worldwide.