Amazon Q2 Earnings were reported last week and as expected it has been a blowout quarter for Amazon.
Net Sales up 40%, Net income up 100%. Q3 Guidance of 28% to 34% growth
Amazon reported net sales are up 40%, on a guidance of 18% to 28%. Net income is up 100% from $2.6B to $5.2B. This is despite COVID related investments Amazon has had to make.
Q3- 2020 sales growth guidance is between 28% and 34%. We should expect another huge quarter in Q3 based on this guidance. Surging COVID cases in the US and retail bankruptcies will continue to fuel this growth.
For the first time in the Amazon Q2 Earnings, the international segment showed an operating profit.
Advertising revenue grew by 41% in Amazon Q2 Earnings
Advertising revenue is up 41%. It only grew by 8% over Q1 2020, while retail sales grew by 25%.
Note: Advertising revenue is reported under the “Other” line item in the quarterly filings. “Other” includes sales of advertising services, as well as sales related to our other service offerings.
Online Stores, 3P Services the primary growth driver
While AWS and advertising growth rates in Q2 were largely inline with Q1, Online stores and 3P Seller Services have shown a dramatic increase and topped the list. Note that advertising and AWS had been leading the pack for the past few quarters.