Amazon exceeded Wall Street’s revenue and profit expectations for the first quarter — but delivered a new warning about the potential future impact of tariff and trade policies on its future financial guidance.
The company posted sales of $155.7 billion, up 9%, and profits of $17.1 billion, or $1.59 a share. That topped expectations of $155.1 billion in revenue and earnings of $1.36 per share among analysts polled in advance.
- Amazon Web Services revenue rose 16.9% to $29.3 billion, taking the cloud unit’s annual revenue run rate to a record $117 billion but registering its lowest year-over-year quarterly growth rate in more than a year.
- Advertising services revenue grew 18% year-over-year to $13.92 billion, maintaining its position as one of the company’s fastest-growing segments.
- Third-party seller services revenue grew 6% to $36.5 billion, continuing a steady decrease in year-over-year growth rates, down from double-digit gains as recently as last year.
- Subscription services, including Prime memberships, grew 9% to $11.72 billion, reflecting steady demand for Amazon’s bundled content and delivery offerings.
- Online store sales rose 5% year-over-year to $57.4 billion, showing modest growth in Amazon’s core e-commerce business amid broader economic uncertainty.
Amazon shares fell about 4% in after-hours trading after its guidance for second-quarter operating income came in lower than analysts had been expecting.
In a section introducing the company’s second quarter guidance, Amazon added “tariff and trade policies” to a list of factors that create uncertainty in its results, joining existing risks such as inflation, interest rates, and regional labor market constraints. That tariff risk was not mentioned in its fourth quarter results.
Looking ahead to the second quarter, Amazon projects revenue between $159 billion and $164 billion, representing 7% to 11% growth compared to the same period last year.
Amazon expects second-quarter operating income between $13 billion and $17.5 billion, compared with $14.7 billion in the second quarter of last year. That compared with Wall Street expectations of $17.8 billion, Bloomberg reported.
Investors and analysts will be listening closely for additional about the impact of tariffs on the company’s business during Amazon’s earnings call, which starts at 2 p.m. Pacific.
Follow-up: Amazon CEO Andy Jassy gives measured take on tariffs, says company could emerge stronger
