Amazon’s Revenue Rose by 9% in the Fourth Quarter

Amazon’s revenue rose by 9% in the fourth quarter and it reported a gain of almost $12 billion from its investment in Rivian.

The company guided for first-quarter revenue of between $112 billion and $117 billion, below the average estimate of $120 billion. 

Fourth-quarter sales rose by 9.4% to $137.4 billion. That’s Amazon’s first period of single-digit growth in several years.

Nevertheless, even with the weaker-than-expected sales number and disappointing guidance, the company gave investors enough confidence that growth will recover. It is worth noting that the market had a very different reaction to Meta’s results on Wednesday. Thus, the company’s stock experienced its worst-ever drop after its earnings, as well as forecast, missed estimates. 

Amazon’s results and investors

Let’s learn more about Amazon’s business empire. For example, it disclosed revenue from its fast-growing advertising business for the first time. During the quarter, advertising services rose by 32% year over year to $9.7 billion. Previously, the company included advertising revenue in its “other” business segment.

Apart from Amazon, Google, as well as Facebook, earned billions of dollars thanks to ads. For instance, Google reported fourth-quarter ad revenue of $61.2 billion, while Facebook notched ad sales of $32.6 billion in the period.

Amazon’s big profit gain on electric carmaker Rivian is the result of the electric carmaker’s IPO in 2021. Notably, earnings per share, including the Rivian gain, was $27.75 for the quarter. 

Amazon was the last mega-cap tech company to report its results. As a reminder, Netflix kicked it off in a disastrous fashion, with a miss on subscriber estimates. Apple, Microsoft, as well as Alphabet followed by cruising past estimates, all before Facebook’s parent company’s troubling numbers. 

Amazon’s CEO Andy Jassy said the pandemic continues to pose challenges. Facing a tight labour market, the company last year hiked wages to an average of $18 an hour to attract employees, offering signing bonuses worth as much as $3,000 in some markets. 

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