Amazon's cloud flies high, but profit disappoints

Bezos with the Kindle Fire
Jeff Bezos with the Kindle Fire Credit: Martyn Williams

AWS produced $687M profit last quarter, a jump of 69 percent

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Profits from Amazon's cloud division jumped 69 percent last quarter, but the rest of its business fared less well.

Amazon Web Services generated an operating profit of $687 million in the three months to Dec. 31, on sales of $2.4 billion, Amazon said Thursday. That was up from $240 million in profit and sales of $1.4 billion a year earlier.

Amazon started breaking out its cloud numbers last year and it's proved to be the most profitable part of its business. Operating margins at AWS were 29 percent last quarter, compared to 3 percent for the company as a whole.

But its results overall, including e-commerce sales and movie rentals, fared less well. Total worldwide sales were up 22 percent to $35.8 billion, but earnings of $1 per share were well below the $1.56 analysts had been expecting, according to a poll by Thomson Reuters.

That pushed Amazon's shares 11 percent lower in after hours trading, to $562, wiping out the 9 percent gain it made during regular trading.

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