AWS sees huge jump as Amazon posts highest-ever profits

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Amazon’s cloud business sales jumped 45 per cent in the fourth quarter, the company has recently announced. These results are far beyond what any analyst expected for the period.

According to multiple media sources, Amazon Web Services have seen revenue of $5.11 billion in the fourth quarter, and a total revenue of $17.46 billion in 2017 as a whole. Analysts expected $4.97 billion.

During Amazon’s conference call with analysts, CFO Brian Olsavsky said the company now has a revenue run rate of more than $20 billion. Operating income went up to $1.35 billion, also exceeding expectations of $1.27bn.

The media are praising Amazon’s success, saying that other big players in the cloud business industry are still trying to catch up. Alibaba, Google, IBM, Microsoft, Oracle, those are all companies that are behind Amazon, trying to grab a piece of the cloud pie.

Looking at the mid to long-term, AWS has grown into a real cash factory for its parent company. Three years ago, less than five per cent of Amazon’s entire revenue came from Amazon Web Service. This time around, however, it has grown to roughly 8.5 per cent. Looking at 2017 as a whole, roughly 10 per cent of Amazon’s entire revenue came from AWS.

Analysts also praised Amazon’s success: "There are few enterprise franchises that are operating at an annual run rate approaching $20B in scale yet still delivering high growth in excess of 40 per cent," KeyBanc analysts led by Edward Yruma wrote in a Jan. 28 note.

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