Although not flawless, Amazon’s (AMZN) third-quarter earnings helped ease investor concerns brewing for a few weeks. As a result, Amazon’s stock is seeing a significant increase in Friday trade.
As of late Thursday, Amazon exceeded forecasts with earnings of $1.43 per share and sales of $158.9 billion. However, the internet giant’s third-quarter revenues for its highly watched Amazon Web Services cloud subsidiary also came in slightly lower than predicted, and its revenue prediction for the holiday season was also slightly lower than projected.
Nevertheless, Amazon’s stock increased more than 6% to 198.80 today. According to analysts, the reason for the strong response is that Amazon’s operating profits exceeded expectations.
The “main metric everyone was worried about,” according to a client note by Mark Kelley, an analyst at Stifel, was operating income. How long Amazon could sustain the consistent increase in profitability under CEO Andy Jassy was a topic of discussion among analysts. To support its AI goals, the corporation is investing billions of dollars in processors and new data centers. Additionally, it is increasing the amount of money it spends on its satellite internet project, Project Kuiper.