Amazon shares surge after posting Q1 profit of $3B, jump in sales

Amazon’s first-quarter revenue beat estimates on Thursday, helped by resilient demand for online shopping and cloud services businesses, sending its shares up about 9% in extended trading.

The world’s biggest online retailer reported better-than-expected net sales of $127.36 billion in the first three months of the year and forecast sales between $127 billion and $133 billion in the second quarter.

Analysts had expected sales of $129.83 billion in the quarter ending June 30.

The growth of Amazon Web Services, long a major source of profit, slowed to 15.8% in the first quarter, while recession-wary businesses have slowed their spending.

Net profit stood at $3.17 billion in the quarter ended March 31, compared with a loss of $3.84 billion, a year earlier.

Addressing ongoing worries about the economy, CEO Andy Jassy has aimed to clamp down on spending across Amazon’s vast array of businesses.

Last month, he said Amazon would cut more jobs, now from its long-profitable cloud and advertising divisions, expanding the company’s layoffs since November to 27,000 employees, or 9% of its roughly 300,000-strong corporate staff.

Amazon likewise has ended entire services, including on Wednesday when it said it would pull its lineup of Halo health trackers and refund recent purchases.

At the same time, it is seeking new revenue in the face of inflation that hurt retail demand in Europe, among other challenges.

Beyond higher grocery delivery fees for US Prime loyalty members, it is offering them an add-on generic-drug subscription and it marketed discounted membership for primary care services after it closed a deal to buy provider One Medical in February.