With a strong focus on cost cutting, continued enhancement of the customer experience, continued investment in AI (have you met Rufus?? - link below) significant growth in advertising, and improved margins for the past 5 quarters, the Amazon quarterly results came in well above expectations with shares rising 11% in after hours trading.
Group net sales - $169.96 billion up 14% YoY (beating estimates)
Operating income: $13.21 billion VS $2.74 billion YoY (beating estimates)
Advertising sales - $14.7 billion up 27% YoY
Recently spending $19 billion on content and gaining subscription revenues of $10 billion Amazon launched its ads on Prime Video this week which should impact the company's advertising business significantly in 2024. CEO Andy Jassy quoted "Prime Video will have meaningfully fewer ads than linear TV and other streaming TV providers."
- Increased total viewership for the second season of?Thursday Night Football?(TNF) by 24% YoY, and had double-digit growth (14%) for the second consecutive season in the hard-to-reach 18–34-year-old demographic, (according to Nielsen). Seahawks-Cowboys game on 30 November attracted 15.3 million viewers, becoming Prime Video’s most watched?TNF?game ever - (according to Nielsen)
- Amazon MGM Studios released 16 films including the second season of?Reacher, which was the No. 1 title on Nielsen’s Top 10 Originals Streaming chart for the week it debuted and had the highest number of minutes viewed for any Prime Video title during a single week in 2023 according to Nielsen, the second season of?Invincible, the most-viewed animated series ever on Prime Video globally, holiday comedy?Candy Cane Lane, one of the top 10 most-watched worldwide film debuts ever on Prime Video; Saltburn, which had the highest week-over-week audience growth of any film on Prime Video in 2023, American Fiction; and sports drama The Boys in the Boat (Starring Callum Turner and Directed by George Clooney).
- This awards season, Amazon MGM Studios earned 16 Golden Globe nominations, 68 Emmy nominations and nine wins, and 21 Critics Choice Award nominations for American Fiction,?Saltburn, Daisy Jones & The Six, The Marvelous Mrs. Maisel, and The Boys. For the upcoming Oscars, the studio earned five nominations for?American Fiction, including for Best Picture.
- The international slate grew of with more than 60 local Amazon Originals, including?Mr. Dressup:The Magic of Make-Believe?(Canada), which was winner of the 2023 People’s Choice Award for Documentary at the Toronto International Film Festival;?Sayen: La Ruta Seca (Chile), the action-packed sequel to the most watched Latin American Original movie ever on Prime Video;?Operación Triunfo?(Spain), Prime Video’s first weekly live entertainment show; and?007: Road To A Million?(UK), the world’s first James Bond television format, hosted by Brian Cox which was No. 1 on Prime Video in 27 countries worldwide on its launch weekend.
- In sports programming, Prime Video debuted Kelce, the sports-docuseries?chronicling Philadelphia Eagles captain Jason Kelce’s 2022 season, and?Bye Bye Barry, the story of Barry Sanders’ decision to retire at the height of his NFL career. In live sports, Prime Video added new broadcast rights for NASCAR, the National Women’s Soccer League, and Premier Boxing Champions in the U.S., ICC Cricket in Australia; and Wimbledon tennis in Austria and Germany.
Whilst the staggeringly good results from both Amazon and Meta (Facebook) were received rapturously after Thursday's market close it is not yet a true indicator of the fate of the broader global economy. However, with inflation numbers falling and The Fed, ECB and BoE holding interest rates, we may continue to see a much more profitable 2024. Q2 will be a strong indicator on this.
Amazon earnings transcript below.
