Amazon announces fourth-quarter sales are up 22 percent

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Amazon announces fourth-quarter sales are up 22 percent

Amazon has recently announced that its fourth quarter sales (ending 31st December 2015) were up 22 percent to $35.7 billion. Furthermore, operating cash flow increased by 74 percent to $11.9 billion for the 12 months in 2015, compared with $6.8 billion for 2014.

Amazon announced on Thursday that its fourth-quarter sales, ending Dec. 31, 2015, were up 22 percent to $35.7 billion. Furthermore, it's operating cash flow increased by 74 percent to $11.9 billion for the 12 months to 2015, compared with $6.8 billion for 2014.

Jeff Bezos, founder, and CEO of Amazon.com said:

Twenty years ago, I was driving the packages to the post office myself and hoping we might one day afford a forklift. This year, we pass $100 billion in annual sales and serve 300 million customers.

And still, measured by the dynamism we see everywhere in the marketplace and by the ever-expanding opportunities we see to invent on behalf of customers, it feels every bit like Day 1.

Fourth-quarter 2015 results

Net sales increased 22 percent to $35.7 billion in the fourth quarter, compared with $29.3 billion in the last quarter of 2014. This excluded $1.2 billion costs associated with unfavorable foreign exchange rates. Other highlights include:

  • Net sales increased 26 percent compared with the fourth quarter of 2014.
  • Operating income increased 88 percent to $1.1 billion in the fourth quarter compared with the fourth quarter of 2014.
  • Net income was $482 million in the fourth quarter, or $1.00 per diluted share, compared with net income of $214 million, or $0.45 per diluted share, in the fourth quarter of 2014.

Full year 2015 results

Net sales increased 20 percent to $107.0 billion, compared with $89.0 billion in 2014. This excluded $5.2 billion costs associated with unfavorable foreign exchange rates.

  • Net sales increased 26 percent compared with 2014.
  • Operating income was $2.2 billion, compared $178 million in 2014.
  • Net income was $596 million, or $1.25 per diluted share, compared with net loss of $241 million, or $0.52 per diluted share, in 2014.

New Amazon Web Service features

There were many improvements and highlights over 2015 that contributed to the rise in net income, and we shall highlight some of these highlights related to Amazon Web Services below:

  • The Launch of new AWS Regions — AWS announced the launch of its Asia Pacific (Seoul) Region in Korea and its intention to open a new region in Canada. This brings the AWS Cloud to 32 Availability Zones across 12 geographic regions worldwide. Furthermore, an additional five AWS Regions (and 11 Availability Zones) in Canada, China, India, Ohio, and the U.K. expected to be available in 2016.
  • Amazon WorkMail — AWS announced the general availability of Amazon WorkMail. This is a software suite which includes email and calendar service.
  • AWS IoT Launched — This is a managed cloud platform that lets billions of connected devices, such as mobile phones, cars, factory floors, aircraft engines, sensor grids, and more easily and securely interact with cloud applications and other devices.
  • AWS announced AWS Certificate Manager (ACM) — This is a new service that enables customers to easily provision, manage, and deploy Secure Sockets Layer/Transport Layer Security (SSL/TLS) certificates for use with AWS services.
  • AWS launched EC2 Scheduled Reserved Instances — This allows customers to reserve capacity for their applications that run on a part-time, recurring basis.
  • AWS rolled out 722 New Services throughout 2015 — This represents a 40 percent increase over 2014.

First-quarter 2016 forward guidance

With a strong performance in 2015, all eyes are now on the initial guidance for 2016. Amazon has released some initial forecasts, and while these are within a relatively wide margin, it does show that they anticipate further growth. This is a very positive sign.

  • Net sales to grow between 17 percent and 28 percent compared with first quarter 2015.
  • Operating income has a wide margin of error, but has the potential to grow up to $700 (the lower figure given is just $100 million growth), some $445 higher than the first quarter of 2015. Either way, growth is predicted.
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