AWS keeps driving Amazon profits as more move to the cloud

Clare Hopping

29 Apr, 2019

Amazon has unveiled record high profits, obtaining more than double the levels investors were predicting, with much of its gains coming from the AWS division.

It will come as no surprise to regular readers of Cloud Pro that the cloud arm of Amazon is reeling in the most cash of all its parts, achieving $7.7 billion in revenue ($2.2 billion profit), which represents a 41% year-on-year growth.

However, its cloud revenues of $7.7 billion only represented 13% of the company’s total revenues over the first quarter of the year, but taking almost half of its total profits – demonstrating just how profitable the division is for the company’s bottom line.

There were some big cloud achievements for the firm over the quarter, including the launch of the AWS Asia Pacific (Hong Kong) Region, and announcing plans for the AWS Asia Pacific (Jakarta) Region, the launch of Amazon S3 Glacier Deep Archive, Concurrency Scaling for Amazon Redshift and general availability of Amazon EFS Infrequent Access.

Plus new business from some of the world’s biggest companies including Volkswagen, Ford, Lyft and Gogo had a positive impact on its cloud business.

Revenues for the entire company hit a Wall Street-beating $59.7 billion, although spending on technology such as AI and smart homes has also increased, meaning profits weren’t as high as they could have been and growth is likely to slow in the future.

It’s also spending a lot on developing its own cloud infrastructure, again making a dent in profits in the short term, and its planned one-day Prime shipping rollout is also likely to cost a fair whack in terms of logistics.