Amazon shares surge after surprise profit

As of this writing, shares of Amazon were up 17% at $564.15 per share in after-hours trades.

Amazon is now worth more than retail behemoth Wal-Mart in market capitalization.

Revenue: $23.18 billion versus analyst estimates of $22.39 billion.

The company had a $92 million net profit, up from a $126 million loss in the period a year ago, on revenues of $23.19 billion, up 19.9%.

“We think EGM (especially in the U.S.) is the best proxy for overall commerce growth for Amazon as it is generally a catch-all category for everything outside Media, and growth here accelerated sequentially second quarter in a row”, Jefferies’ research team wrote shortly after earnings were released.

Since its inception, Amazon has refined and expanded AWS while competitors including Microsoft Corp. and Google Inc. have tried to replicate its success. The company has a market cap of $227,252 million and the number of outstanding shares have been calculated to be 465,681,000 shares. During the same quarter in the prior year, the company posted $0.23 earnings per share.

Operating cash flow increased 69% to $8.98 billion for the trailing 12 months and free cash flow increases to $4.37 billion during the same time-frame.

Amazon management offered third quarter guidance ranging from a loss of 0 million to million in profits.

In the quarter, Amazon said, sales in its core North American market jumped 25% to $13.8 billion with an operating profit of $703 million, more than twice last year’s result.

The prime demo for AMAZON Prime Day was 18-34s. The narrowing gap, which is now just 7 percentage points, could also be a sign that Amazon’s competitive advantage in the space is eroding because if a company is only growing at the same pace as its industry, its growth owes to the industry it competes in rather than the company’s own strength. “We’re used to competition, but we focus on the customer…” Shares in Google surged 16%, to a record high, after Google reversed six straight quarters of disappointing results. Also, Director Alain Monie sold 3,000 shares of Amazon.com stock in a transaction dated Friday, May 1st.

Amazon Web Services provides cyber space for businesses to save data and run systems, eradicating the need to build data centres and servers costing hundreds of millions.

In part, that means more people are buying things on Amazon.com, as the company has added to the ranks of its Prime membership and trotted out new promotions such as Prime Day on July15, an all-day sale of some items.

Amazon.com, Inc. using SYMBOL code NASDAQ:AMZN has had its stock rating noted as “Upgrade” with the recommendation being set at “MKT PERFORM >> MKT OUTPERFORM” this morning by analysts at JMP Securities.