Amazon ekes out a profit for Q4 with sales up 15%, though company ends 2014 in the red
Investors reward company report by raising stock in after-hours trading, company earnings report remains vague on sales of its digital device sales
The online retailer Amazon.com was able to report higher Q4 sales yesterday afternoon after the close of the markets, reporting revenue was up 15 percent for the quarter that included the holiday shopping season. For the quarter, Amazon reported a net income of $214 million, compared with net income of $239 million in the same quarter of 2013.
The profit in Q4 ended a two quarter streak of negative profit news, but could not help the company turn a profit for the full year. For all of 2014, net income was a loss of $111 million, versus a profit in 2013 of $506 million. On the plus side, revenue for the full year grew to $70.08 billion, up 15 percent for the year.
Once again, the company gave a guidance for Q1 of 2015 that would be more accurate if predicted throwing darts: between a loss of $450 million and a profit of $50 million. In other words, losses are a coming.
There is clearly a lot going on a Amazon, and investors remain patient. Despite the lackluster earnings report (especially in comparison to Apple’s report this week) investors pushed the stock higher in after hours trading. But, let’s be honest, the stock was carried upward by the huge gains in the market seen on Thursday.
Some of the highlights from Amazon’s report:
- Amazon announced Prime Now, a new service offering paid one-hour and free two-hour delivery on tens of thousands of daily essentials via a new mobile app. The service is currently available in Manhattan and will expand to other cities this year.
- Amazon introduced Prime Photos, providing free unlimited photo storage in Amazon Cloud Drive. Prime members now have a simple, secure place to store their existing collections of photos, automatically upload new photos as they are taken, and access them anytime, anywhere, at no cost.
- Amazon introduced Fire TV Stick, bringing the same experience customers love about Amazon Fire TV — ease of use, great performance, and vast selection — to a smaller and even more affordable device. Fire TV Stick plugs into the HDMI port on an HDTV and provides instant access to movies, TV shows, music, photos, apps, and games.
- Amazon introduced Echo, a new category of device designed around voice recognition. Echo is hands-free and always on — customers can ask it for information, music, news, and weather from across the room and get results or answers instantly. Echo uses far-field voice recognition with an advanced array of seven microphones to clearly hear around the room, and has advanced audio design that includes dual downward-firing speakers that produce 360˚ omni-directional, room-filling audio.
- The critically-acclaimed Prime-exclusive series, Transparent, received two Golden Globes. Transparent is the first series from a streaming video service to win a Golden Globe for best series.
Amazon Studios announced it will begin to produce and acquire original movies for theatrical release and early window distribution on Prime Instant Video. Production will begin in 2015 with the goal of bringing a dozen original, prestige movies to customers each year.
- Amazon debuted its first pilot season of 2015, which is available exclusively on Amazon Instant Video in the U.S., U.K., and Germany. The new pilots include Cocked, Mad Dogs, The Man in the High Castle, Point of Honor, Down Dog, Salem Rogers, and The New Yorker Presents,as well as six new kids pilots. All ten episodes of the highly-anticipated dramatic comedy series Mozart in the Jungle premiered on Prime Instant Video in the U.S., U.K., and Germany. In addition, all ten episodes of the drama series, Bosch, will premiere in February on Prime Instant Video in the U.S., U.K., and Germany.
- Amazon Studios announced it will produce the first television series from Oscar-winning director and producer Woody Allen, which will debut exclusively on Prime Instant Video in the U.S., U.K., and Germany in 2015. Untitled Woody Allen Project has received a full season order and will be written and directed by Allen.
- Amazon launched the Kindle Store in the Netherlands, offering over 3 million titles in many languages, over 700,000 Kindle exclusives, and more than 20,000 titles in Dutch.
- AmazonFresh expanded to Manhattan and Philadelphia. Prime members in eligible zip codes can combine grocery and other shopping into one seamless experience. Customers can order from over 500,000 items for same-day and early morning delivery.
- With over 515 significant service and feature releases in 2014 (up more than 80% year-over-year), and over one million active customers, Amazon Web Services (AWS) continues to grow strongly, with usage growth close to 90% year-over-year for the fourth quarter.
Noticeably missing was much work on Fire Phone or Kindle sales.