Amazon, flush with cash, says it will let you peek inside AWS' pants

Plans to break out numbers for cloud biz for first time this year

Amazon left smiles on investors' faces on Thursday following a fourth-quarter earnings report that trounced analysts' estimates.

While Wall Street was expecting to see earnings of $0.17 per diluted share, the actual figure came in at $0.45 per share – which, while not as good as the $0.51 per share that Amazon earned in the fourth quarter of 2013, was still a pleasant surprise.

The fourth quarter is always a busy one for Amazon, given the holiday shopping season, and this was no exception. Revenues for the three months ending on December 31 were $29.33bn, a 14.6 per cent increase over the year-ago period.

The business was strongest in North America, where sales were up 22.3 per cent, to $18.75bn. International sales, on the other hand, were only up 3.2 per cent.

Total sales for fiscal 2014 were $89bn, up 19.5 per cent from 2013, with the strongest growth similarly happening in North America.

Amazon was particularly keen to point out the success of its Prime loyalty program during Thursday's earnings report. Although the online retailer raised the price of Prime by 25 per cent in 2014, worldwide paid membership reportedly grew by 53 per cent in 2014, on what Amazon guardedly describes as "a base of tens of millions."

"Prime is a one-of-a-kind, all-you-can-eat, physical-digital hybrid – in 2014 alone we paid billions of dollars for Prime shipping and invested $1.3 billion in Prime Instant Video," Amazon CEO Jeff Bezos said in a statement. "We'll continue to work hard for our Prime members."

And yet it still made a net loss. HOW CONVENIENT

While Prime is an important word for Amazon, however, most investors prefer a different P-word: profit. And here, once again, Amazon failed to impress. The firm posted net income of $214m for the fourth quarter, which was actually down 10.5 per cent from the year-ago period. And for fiscal 2014 it posted a net loss of $297m. But Amazon investors should be used to such paltry income figures by now.

More interesting to your humble Reg hack are the fortunes of Amazon Web Services (AWS), the e-tailer's cloud services sideline. Total revenues for the company's "Other" reporting item – which encompasses AWS and some other odds and ends – were $1.74bn for the fourth quarter, a 41 per cent year-on-year increase. The figure was similarly up 42.3 per cent on an annual basis, with Other revenues reaching $5.6bn for all of fiscal 2014.

Amazon certainly isn't slowing down on AWS expenditures, either. It spent $1.14bn on purchases of property and equipment in the fourth quarter – a 30 per cent year-on-year increase – most of which likely went to building out its massive data centers.

By comparison, cloud rivals Microsoft and Google spent $1.49bn and $3.55bn on capital expenditures, respectively, during the same period.

Microsoft listed revenues of $2.59bn for its "Commercial Other" reporting item – where it books sales of its Azure cloud – in its most recent quarter, and Google reported "Other revenues" of $1.95bn in its own Q4. But each company obscures its actual cloud sales figures beneath numerous other items, making their actual cloudy cash flows hard to estimate.

That may soon change, though. In a conference call with financial analysts on Thursday, Amazon CFO Tom Szkutak said the firm plans to finally start breaking out the numbers for AWS in its earnings reports later this year.

"We just think it's an appropriate way to look at our business in 2015," Szkutak said. ®

Broader topics

Other stories you might like

  • Infosys skips government meeting – and collecting government taxes
    Tax portal wobbles, again

    Services giant Infosys has had a difficult week, with one of its flagship projects wobbling and India's government continuing to pressure it over labor practices.

    The wobbly projext is India's portal for filing Goods and Services Tax returns. According to India's Central Board of Indirect Taxes and Customs (CBIC), the IT services giant reported a "technical glitch" that meant auto-populated forms weren't ready for taxpayers. The company was directed to fix it and CBIC was faced with extending due dates for tax payments.

    Continue reading
  • Google keeps legacy G Suite alive and free for personal use

    Google has quietly dropped its demand that users of its free G Suite legacy edition cough up to continue enjoying custom email domains and cloudy productivity tools.

    This story starts in 2006 with the launch of “Google Apps for Your Domain”, a bundle of services that included email, a calendar, Google Talk, and a website building tool. Beta users were offered the service at no cost, complete with the ability to use a custom domain if users let Google handle their MX record.

    The service evolved over the years and added more services, and in 2020 Google rebranded its online productivity offering as “Workspace”. Beta users got most of the updated offerings at no cost.

    Continue reading
  • GNU Compiler Collection adds support for China's LoongArch CPU family
    MIPS...ish is on the march in the Middle Kingdom

    Version 12.1 of the GNU Compiler Collection (GCC) was released this month, and among its many changes is support for China's LoongArch processor architecture.

    The announcement of the release is here; the LoongArch port was accepted as recently as March.

    China's Academy of Sciences developed a family of MIPS-compatible microprocessors in the early 2000s. In 2010 the tech was spun out into a company callled Loongson Technology which today markets silicon under the brand "Godson". The company bills itself as working to develop technology that secures China and underpins its ability to innovate, a reflection of Beijing's believe that home-grown CPU architectures are critical to the nation's future.

    Continue reading

Biting the hand that feeds IT © 1998–2022