Amazon profits up 40% in first quarter

Amazon has reported its eighth profitable quarter, with profit up 40%, to $724m (£560.8m) in the first three months of the year.

The online e-commerce giant also saw its revenue surge 24% to reach $35.7bn (£27.6m), higher than analysts expected. The company said sales for web services and retail subscriptions, such as Amazon Prime, had helped to propel its growth.

It also highlighted expansion in India and Mexico and the UK. International net sales at the retailer were up 15.6% year-on-year to £11.06bn.

The market responded positively to the results, which stock increase 4% in after-hours trading, according to Business Insider.

Neil Saunders, managing director of GlobalData Retai, told the BBC that although Amazon’s sales had grown by 23% over the quarter, “the pace of growth at the online behemoth remains much slower than it was over most of the prior fiscal year”.

"Some of this is the result of a less favourable exchange rate diluting contributions from the international business. However, some is also down to a more challenging demand environment in North America, which has limited spending uplifts on products within Amazon's core territory,” he said.

In the UK, the firm launched Amazon Business within the period the results relate to, which provides business customers with tools such as purchase approvals, VAT-exclusive pricing, invoicing, and quantity discounts. Its grocery service AmazonFresh also expanded in 260 postcodes in London, Surrey and Hampshire.

In January the retailer announced plans to create more than 5,000 full time jobs in 2017, taking its total UK workforce to over 24,000 permanent roles by the end of the year. As part of this, it plans to open a fulfilment centre in Warrington, employing 1,200 people it said yesterday.

The company held its second Amazon Academy last month, run in association with Enterprise Nation, attended by over 300 SMEs and Amazon also continued to promote its self-publishing arm Kindle Direct Publishing (KDP) by launching the £20,000

Kindle Storyteller Award, recognising newly published work in the English language across any genre.  

Last year Forbes said that Jeff Bezos, Amazon’s founder, had become the world’s second richest person after Amazon's stock had grown. He owns 18% shares in the retailer.