AWS casts a ray of strong sunshine on Amazon's profitability

Cloud sales for the third quarter were up 78 per cent from a year earlier

Much of Amazon's sunny earnings report for the third quarter of 2015 can be traced back to its Web Services Cloud division.

AWS brought in $US2.09 billion in sales in the quarter ended September 30, representing a jump of 78 per cent over the same period last year. With an operating profit of $US521 million -- up from just $US98 million a year earlier -- the unit’s operating profit margin was 25 per cent for the quarter, up from 21 per cent in Q2 and 17 per cent in Q1.

Overall, Amazon beat analyst expectations with $US25.4 billion in net sales and a profit of $US79 million, or $US0.17 per share. Shares of the company's stock shot up by as much as 11 per cent in extended trading as a result.

Amazon only began breaking out AWS numbers earlier this year, so these are among the first indications the market has seen of the unit's financial performance.

"We're continuing to see a great acceleration in the pace of innovation," said Brian Olsavsky, Amazon's chief financial officer, on the company's earnings call Thursday afternoon.

AWS has launched more than 500 significant new features this year, Olsavsky said, and it has lowered prices eight times since April 2014.

"Customers are really responding," he said. "They like the speed and agility AWS provides, and they like the new features, many of which allow them to lower their costs."

Aurora, for example, was launched earlier this year as a high-performance alternative to the widely used open-source MySQL database.

Nevertheless, it's still early days, Olsavsky acknowledged.

"We enjoy leading this business, and we believe we're adding new services and features at a rate faster than many others," he said. "The growth rate will remain lumpy and bumpy going forward, but we're very encouraged."

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags amazon.comAWScloud computing

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Katherine Noyes

IDG News Service
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?