Wall Street had high expectations for Amazon, and company surpassed them by soaring past revenue and earnings estimates thanks to a massive holiday shopping season.
After markets closed on Wednesday, Amazon reported revenue of $60.5 billion and earnings of $3.75 cents a share for the three months ending on Dec. 31. Analysts had projected $59.83 billion in revenue and earnings of $1.85 cents a share on average. Amazon had a 38 percent year-over-year increase in sales.
Amazon’s $1.9 billion profit gave the company’s its 11th straight profitable quarter.
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Amazon accounted for nearly half of all online holiday sales, according to GBH Insights.
Shares jumped more than 6 percent in after-hours trading to about $1,475 per share.
CEO Jeff Bezos pointed to the success of Alexa, Amazon’s personal assistant featured in its Echo home speakers, as a key driver.
Amazon Web Services, the company’s cloud storage business, was also a big winner for the company, pulling in $5.11 billion in quarterly revenue.
“Our 2017 projections for Alexa were very optimistic, and we far exceeded them. We don’t see positive surprises of this magnitude very often — expect us to double down,” said Bezos in a statement. “We’ve reached an important point where other companies and developers are accelerating adoption of Alexa. There are now over 30,000 skills from outside developers, customers can control more than 4,000 smart home devices from 1,200 unique brands with Alexa, and we’re seeing strong response to our new far-field voice kit for manufacturers.”
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The company pointed out 50 “highlights,” including hiring 130,000 workers in 2017. Fire TV Stick and Echo Dot were the best-selling products for the year, and Amazon’s 11-game Thursday Night Football package averaged 1.67 million viewers each week.
Amazon has not released its number of Prime members, but said more people signed up for the service in 2017 than before.
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Amazon Studios’ “The Big Sick” was nominated for an Academy Award for Best Original Screenplay. In 2018, Amazon Studios is moving from indie projects to big-budget movies that appeal to a wider audience. This was evident at the Sundance Film Festival, where Amazon bid on several films, but ultimately walked away empty handed. The company did land the rights to a multi-season “Lord of the Rings” series during Q4, which Amazon hopes will entice consumers to buy Prime memberships.
Amazon has also turned its search for “HQ2” into a tech game show of sorts, narrowing its list down to 20 North American cities last month. The winning location will land up to 50,000 new jobs and a $5 billion cash infusion.
Earlier this week, Amazon partnered with Berkshire Hathaway and JPMorgan Chase to create an unnamed health care company for its workers that’s “free from profit-making incentives and constraints.” The move immediately cut into the market cap of biggest healthcare companies.
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Before the call, Wall Street had big expectations for the company, with shares trading near its all-time high of $1,430 — nearly 30 percent higher since its last earnings call.
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