Amazon Tops Wall Street Estimates: Q3 Net Profits Reach $256 Million

Get ready to start paying for premium Alexa skills as Amazon monetizes Echo

The company said it expected between $56 and $60.5 billion of sales in the fourth quarter, which is always the company's biggest.

"And it's working, customers have purchased tens of millions of Alexa-enabled devices, given Echo devices over 100,000 5-star reviews, and active customers are up more than 5x since the same time a year ago".

AWS, Amazon's enterprise-facing cloud computing unit, brought in $4.6bn in revenues, up 34 per cent year-on-year, a positive sign given Wall Street's concerns over slowing growth for this part of the business. But excluding Whole Foods and favorable foreign exchange rates, revenue is still up 29 percent year-over-year.

Revenue from Amazon Web Services, the company's fast-growing cloud services business, surged 41.9 percent to $4.58 billion, beating the average estimate of $4.52 billion given in polling by data and analytics firm FactSet.

Amazon forecast fourth quarter operating income to range from $300 million to $1.65 billion.

But any worries about the quarter were quickly forgotten when the e-commerce giant announced quarterly results well beyond management's outlook.

This is good news given that Amazon just rolled out an array of new Alexa-enabled devices just before the holiday season. Plus, content and technology at Amazon continue to evolve, and several analysts noted the company's growth (and potential growth) via its connected devices and voice assistance.




Operating profit dropped in all three major segments, by 40 percent in total to $347 million, as operating expenses grew 45 percent from a year ago.

One big question ahead of Amazon's third-quarter report was whether the Whole Foods acquisition would impair profitability.

Amazon's early Whole Foods initiatives included price reductions, selling whole Foods products on Amazon.com and installing Amazon Lockers at Whole Foods locations to drive foot traffic. The dramatic growth of marketing costs, which were partly a function of the Whole Foods acquisition as well as the substantial promotion of new devices, took its toll on the bottom line.

The stock price rose almost 8% in after-hours trading on October 26.

As discovered by the website Voicebot.ai while using an Amazon Echo Show, the Jeopardy skill - based on the TV quiz show of the same name - has started offering a subscription model where users pay $1.99 per month to gain six extra clues each month.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. That's right - they think these 10 stocks are even better buys. Daniel Sparks has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon.

Related news:

Hot News

isis-killer-beheading-video-story-top What you need to know about the plague
Oct 27, 2017 - 01:01
Bubonic plague can advance and spread to the lungs, which is the more severe type of plague called pneumonic plague. Last week, according to the report of the world health organization , the number of victims amounted to 94 people.

isis-killer-beheading-video-story-top Alphabet Inc. (GOOGL) is Seatown Holdings Pte. Ltd.'s 7th Largest Position
Oct 27, 2017 - 00:58
If you are accessing this story on another site, it was illegally copied and republished in violation of global copyright law. The information services provider reported $5.01 EPS for the quarter, missing the consensus estimate of $8.25 by ($3.24).

isis-killer-beheading-video-story-top Samsung announces new Galaxy Tab A, available November 1 for $229
Oct 27, 2017 - 00:55
Note that if you are not in the US , flashing the firmware for the unlocked model won't get you into Android Oreo beta program. The info was revealed in a post by Samsung Turkey, so it is, in fact, coming from an official source.

isis-killer-beheading-video-story-top Theresa Lockhart's body found in wooded area in Allegan County
Oct 27, 2017 - 00:52
Larsen says the body was found based on a tip that was received around 2 p.m. Police say it appeared to be suicide by strangulation. Christopher Lockhart and Theresa Lockhart.

isis-killer-beheading-video-story-top 64 percent of Americans support legalizing marijuana
Oct 26, 2017 - 01:05
The number is the highest level of support in almost half a century of surveying adults on the issue, according to Gallup . Democrats and independents have historically been much more likely than Republicans to say marijuana should be legalized.

isis-killer-beheading-video-story-top Xbox Australia Offer Limited Time Xbox Stay N' Play Experience for Sydney
Oct 26, 2017 - 01:04
Suites will be available for daytime usage, with interested parties able to book a two-hour slot for them and a friend. Due to the expected demand for reservations, a lobby with walk-in gaming will be available from 8am to 8pm each day.

isis-killer-beheading-video-story-top Dustin Pedroia undergoes knee surgery
Oct 26, 2017 - 01:02
After weighing his options since the season ended, Red Sox second baseman Dustin Pedroia went under the knife on Wednesday. In 2017 Pedroia missed all but one game in August with two stints on the disabled list due to problems with his left knee.

isis-killer-beheading-video-story-top United Kingdom economic growth picks up slightly in third quarter
Oct 26, 2017 - 01:00
On an annual basis, GDP expanded by 1.5pc in the third quarter, compared to the same three months in 2016. The latest figures revealed that the manufacturing industry saw the sharpest spike at a 1% rise.

isis-killer-beheading-video-story-top Local rotary club celebrates 'World Polio Day' by spreading awareness
Oct 26, 2017 - 01:00
The Bill and Melinda Gates Foundation joined GPEI as a major supporter in 2007, donating almost $3 billion to polio eradication efforts, Gates Foundation spokeswoman Rachel Lonsdale told CNBC .

isis-killer-beheading-video-story-top Anthem protest starter Kaepernick inks rich book deal
Oct 26, 2017 - 00:59
League officials have said it is up to the players to decide who will attend the meetings on their side. Kaepernick's grievance would provide a fascinating backdrop if he winds up attending the meeting.

isis-killer-beheading-video-story-top LeBron James Shines at Point Guard for Cavs
Oct 26, 2017 - 00:59
The 35-year-old Wade is just 7 of 28 from the field and has committed nearly as many turnovers (8) as he has assists (10). Rookie Lauri Markkanen scored 17 of his 19 points in the first half and finished with five 3-pointers.

isis-killer-beheading-video-story-top Former FBI chief James Comey reveals his secret Twitter account
Oct 26, 2017 - 00:55
Mr Comey was sacked by the USA president in May, while investigating links between the Trump campaign and Russian Federation . However, Comey was not, it appears, taking the fledgling steps of those who would seek the office Trump now holds.

isis-killer-beheading-video-story-top Las Vegas Shooter's Brother Arrested For Child Pornography
Oct 26, 2017 - 00:54
Paddock killed 59 people in the meticulously planned attack and wounded 500 more more before shooting and killing himself. Bruce Paddock has not been booked yet, but the official tells PEOPLE charges are expected to be filed sometime today.

isis-killer-beheading-video-story-top Injustice 2 PC Release Set, Open Beta Starts This Week
Oct 25, 2017 - 01:03
Oddly enough, this port of the game might not have any of the DLC, though Warner Bros could clarify that in a statement later on. Raiden's reveal trailer was a surprise when NetherRealm Studios announced that it will come with Black Lightning premiere skin.

isis-killer-beheading-video-story-top Cuomo signs legislation adding e-cigarettes to Clean Indoor Air Act
Oct 25, 2017 - 01:01
You are now not allowed to vape anywhere you're not allowed to smoke in New York State. Andrew Cuomo , who signed the bill into law Monday.