Amazon ad growth slows to 36 percent but still brings the profits

Amazon ad growth slows to 36 percent but still brings the profits

Troy Powers
April 27, 2019

Amazon did not say when it plans to offer Prime one-day shipping.

The company also announced that it would be shaking up its Prime membership by offering one-day delivery on most goods instead of two-day.

Something to look forward to: In its first quarter 2019 earnings call, Amazon chief financial officer Brian Olsavsky revealed the company's plans to offer free one-day shipping as the default for Amazon Prime customers.

Amazon, which hooked shoppers on getting just about anything shipped in two days, said this week that it will soon promise one-day delivery for its U.S. Prime members on most items.

"More broadly, we're seeing continued momentum in enterprise migrations", he said. "We expect to make steady programs quickly and through the year", Olsavky said, but wouldn't say whether it would be fully rolled out by the holidays.

Since its founding 25 years ago, Amazon has grown rapidly into one of the country's largest and most influential companies.

While the United States is Amazon's biggest Prime market, the company has already sped up deliveries beyond two-day in other countries.

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Sales surged at Amazon Web Services (AWS), which provides computing services to companies over the internet - a service know as cloud computing. Earlier this week, Microsoft reported net income of $8.8 billion, more than double Amazon's record this quarter on about half the revenue of its rival. Amazon expects sales to grow between 13% and 20% in the second quarter. In some other countries, such as the U.K., Prime members are already offered one-day shipping.

Amazon's overall $59.7 billion in quarterly revenue was up 19 percent from the first quarter of 2018.

Shares of Seattle-based, which are up 27 per cent so far this year, were little changed in after-hours trading on Thursday from their closing price of US$1902.25.

The company is delving into even less familiar terrain, too.

Analyst consensus estimates were for revenue of $59.65 billion and EPS of $4.72. It recently announced investments in self-driving and electric vehicle companies, teasing how it thinks these high-tech, capital-intensive businesses could pay dividends potentially in the form of autonomous deliveries in the long run.

Sales in Amazon's "other" segment, which is mostly advertising, increased 34 per cent, to 2.72 billion.

Losses narrowed considerably in Amazon's worldwide unit.