Amazon publicly shed light on AWS revenues for the first time

Amazon reported first quarter 2015 sales revenues of $22.7bn, an increase of 15 per cent year on year from $19.7bn, and quarterly cloud revenues of $1.57bn. This is the first time the e-commerce giant has publicly disclosed AWS revenues.

North America saw the bulk of Amazon’s sales growth, with revenue swelling 24 per cent to $13.4bn and operating income increasing 79 per cent to $517m. Outside North America, revenues actually decreased 2 per cent to $7.7bn (excluding the $1.3 billion year-over-year unfavourable foreign exchange impact, revenue growth was 14 per cent).

The company was for the first time pleased to report AWS revenue grew close to 50 per cent to $1.57bn in Q1 2015, with operating income increasing 8 per cent to $26m and a 16.9 per cent operating margin.

“Amazon Web Services is a $5 billion business and still growing fast — in fact it’s accelerating,” said Jeff Bezos, founder and chief executive of Amazon.

“Born a decade ago, AWS is a good example of how we approach ideas and risk-taking at Amazon. We strive to focus relentlessly on the customer, innovate rapidly, and drive operational excellence. We manage by two seemingly contradictory traits: impatience to deliver faster and a willingness to think long term.”

Brian Olsavsky, vice president, chief financial officer of global consumer business said that excluding the favourable impact from foreign exchange, AWS segment operating income decreased 13 per cent. But speaking to journalists and analysts this week Olsavsky reiterated the company was very pleased with the results, and that it would “continue deploying more capital there” as it expands

AWS has dropped its prices nearly 50 times since it began selling cloud services nearly a decade ago, and this past quarter alone has seen the firm continue to add new services to the ecosystem – though intriguingly, Olsavsky refused to directly answer questions on the sustainability of the cloud margins moving forward. This quarter the company announced unlimited cloud storage plans, a marketplace for virtualised desktop apps, a machine learning service and a container service for EC2.