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Home»Finance»Amazon posts solid first quarter earnings growth, but outlook is tempered by tariff uncertainty
Finance

Amazon posts solid first quarter earnings growth, but outlook is tempered by tariff uncertainty

May 3, 2025No Comments4 Mins Read
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Amazon posts solid first quarter earnings growth, but outlook is tempered by tariff uncertainty
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NEW YORK (AP) — Amazon posted larger first-quarter revenue and gross sales that beat analysts’ projections, underscoring the web behemoth’s maintain on customers on the lookout for low costs and a wide array in an unsure economic system.

The Seattle-based firm additionally reported robust gross sales progress for its distinguished cloud computing arm Amazon Internet Companies, it stated after the market closed Thursday.

Nevertheless, uncertainty about President Donald Trump’s tariffs and shopper spending clouded Amazon’s outlook.

Trump’s erratic commerce insurance policies — together with 145% tariffs on China — have paralyzed companies and threaten to boost costs and harm customers. Nevertheless, large firms like Amazon are anticipated to navigate the local weather higher than small retailers.

Amazon, together with many massive retailers and suppliers, have tried to beat the clock by bringing in international items earlier than Trump’s tariffs took impact. And Amazon’s president and CEO Andy Jassy instructed analysts throughout its earnings name that lots of its third occasion sellers did the identical. And due to that transfer, a good quantity of third-party sellers haven’t modified their pricing but, he stated.

Jassy vowed that Amazon would do every thing it may to maintain costs low, and whereas he acknowledged challenges forward, he touted Amazon’s mannequin of huge choice that will assist it navigate this new local weather.

“When there are unsure environments, prospects have a tendency to decide on the supplier they belief most,” Jassy instructed analysts. “Given our actually broad choice, low pricing, and speedy supply, now we have emerged from these unsure eras with extra relative market section share than we began, and higher arrange for the longer term.”

On Friday, Trump can also be ending a commerce exemption that allowed low-value shipments from China to bypass duties, an exemption that had given a bonus to China-founded e-commerce corporations, equivalent to Shein and Temu.

The brand new tariffs may gain advantage Amazon by growing prices for its opponents. However it might additionally have an effect on Chinese language sellers who join with American customers on the corporate’s buying platform. Moreover, it may enhance costs on a recently-launched on-line storefront that Amazon set as much as ship low-cost merchandise instantly from China. The storefront, known as Amazon Haul, was Amazon’s reply to Shein and Temu.

Amazon stated that it earned $17.13 billion, or $1.59 per share, for the quarter ended March 31. That is up from $10.43 billion, or 98 cents a share, within the year-ago interval.

Income rose 9% to $155.7 billion, up from $143.3 billion from the year-ago interval.

Gross sales for Amazon Internet providers rose 17% to $29.3 billion through the fiscal first quarter.

Amazon is among the largest gamers within the race round generative synthetic intelligence. Like different tech firms, it has elevated investments within the know-how and is spending billions to develop information facilities that bolster AI and cloud computing. The corporate can also be investing in its personal laptop chips and people developed by Nvidia. It has additionally expanded its personal AI fashions and built-in generative AI into different components of its enterprise.

Within the first quarter, Amazon reported spending $25.02 billion on property and tools, larger than the $14.92 billion spent in identical interval in 2024.

Amazon this week introduced a $4 billion funding by way of 2026 to develop its rural supply community to carry quicker supply to prospects in much less densely populated areas throughout the U.S.

The corporate stated it expects gross sales within the second quarter to be anyplace from $159 billion to $164 billion. Analysts projected $161.2 billion, based on FactSet.

It additionally tasks working revenue to be within the vary of $13 billion to $17.5 billion for the fiscal second quarter. Analysts anticipate $17.6 billion, based on FactSet.

Amazon shares fell greater than 2% in after-hours buying and selling on Thursday.

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