UPDATED with executive comment. Amazon reported stellar results for the fourth quarter, including record sales of its own devices like the Echo, Fire and Alexa product lines.
The tech giant reported net sales of $72.4 billion, up 20% from the year-earlier quarter and ahead of Wall Street forecasts for $71.87 billion.
Net income surged 58% to $6.04 a share on a diluted basis, well above the Wall Street consensus of $5.67.
During a conference call with analysts, CFO Brian Olsavsky declined to put numbers to the company’s video strategy or forecast spending on original content. “It has been increasing and we expect it to increase further in 2019,” he said of the programming budget. “We’re seeing a lot of continued, strong adoption and usage and viewing and hours watched in both our video and music. It builds stronger Prime connectivity with our Prime members, it leads to higher membership renewal rates and higher overall engagement. We like what we see, and we continue to see that engagement growing.”
Last spring, founder and CEO Jeff Bezos revealed that Prime had surpassed the 100 million mark in terms of total subscribers, the first and only time the company has quantified the pay tier.
In terms of its TV and film presence, aside from noting awards for The Marvelous Mrs. Maisel, A Very English Scandal and Cold War, the company offered no hard information about its efforts. Past Q4 releases have included previously undisclosed viewership information for NFL Thursday Night Football, for example.
Bezos said in the earnings released that the number of research scientists working on Alexa doubled over the past year, resulting in a 20% improvement in the voice system’s ability to understand and answer requests. The number of Alexa skills also doubled to more than 80,000, and customers spoke to Alexa “tens of billions” more times in 2018 compared with 2017, with the number of Alexa-enabled products now past 150.
“We’re energized by and grateful for the response, and you can count on us to keep working hard to bring even more invention to customers,” he said.
One of the top-performing revenue categories in the quarter was “Other,” which includes advertising. It increased an eye-catching 95% from the same period a year earlier, to reach $3.4 billion.
Amazon stock gained nearly 3% during the regular trading session to close at $1,718.73. It declined a fraction after hours, mostly due to company forecasts that were a bit less rosy than Wall Street had expected.