Amazon Handily Beats Analyst Expectations With $25.4B In Sales, Stock Spikes 11%

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Alphabet Beats Q3 Expectations With EPS Of $7.35 And $18.68B In Revenue, Stock Jumps 9% After Hours

Amazon — once again — surprised investors by beating analyst expectations for its third-quarter earnings report, bringing in $25.4 billion in net sales and earnings of 17 cents cents per share. Analysts were expecting a loss of 13 cents per share on sales of $24.91 billion.

Shares of Amazon promptly shot up as much as 11% in extended trading. The company is expecting revenue of between $33.5 billion and $36.75 billion, compared to the $35.1 billion analysts were expecting. The company posted a loss of 95 cents per share in the same quarter a year earlier, and net sales of $20.6 billion in that quarter.

Amazon’s operating income was $406 million, up from a loss of $544 million in the same quarter a year earlier. It reported a net income of $79 million, up from a net loss of $437 million in the same quarter a year earlier.

North America was the company’s main growth driver for its core business. Sales in North America were $15 billion, up 28% from $11.7 billion in the same quarter a year ago, while international sales grew from $7.7 billion to $8.3 billion year-over-year in the third quarter. International sales growth also seems to be slowing: net sales were just up 7% year-over-year in the third quarter, and sales grew 14% in the third quarter from 2013 to 2014.

With this earnings report, Amazon shares have about doubled in the year-to-date period. AWS was once again a huge strong point for the company, reporting a segment operating income of $521 million, compared to $98 million in the third quarter a year earlier.

One question on the call was about whether Amazon would swing back to investing heavily in growth, since the company has most recently been reporting better-than-expected quarters. Amazon’s response was that it was “not as much of a pendulum as has been portrayed.”

“I will point out that this quarter showed a lot of innovation, a lot of new products and features and a lot of investment,” Amazon CFO Brian Olsavsky said on the call. “We’ve already talked about india, but domestically, globally we are investing very heavily in our Prime platform. We’ve launched multiple devices including e-readers, tablets priced under $50, Echo dash buttons, so there’s a lot of investment going on, and there will continue to be, especially related to prime. Innovation and investment will continue and can be lumpy over time.”

Another interesting note from the call: the company continues to expand the usage of Kiva Systems’ robots in its fulfillment centers. It said it had expanded its usage from 15,000 bots at the end of 2014 to 30,000 bots at the end of Q3. “Our intent is to use that more widely, stay tuned,” Olsavsky said.

Amazon reported net AWS sales of $2.085 billion, up from $1.169 billion in the same quarter a year earlier. That’s a 78% jump in net sales for the company’s AWS business, which it started breaking out earlier this year.

It’s even a big quarter-over-quarter jump: Amazon $1.82 billion in net sales for AWS in the previous quarter. It’s reporting $5.5 billion in AWS net sales for the first nine months of the year, compared to $3.2 billion in the first nine months of the year prior.

As part of the earnings report as well, the company expects to create 100,000 seasonal job positions in North America, and 40,000 across its European Fulfillment Network during the holiday season. The company says it converted tens of thousands of part-time employees into full-time employees, and expects to do the same this year.

Amazon posted a surprise profit in Q2 on the strength of its Amazon Web Services, promptly sending the stock up 14%. Shares of Amazon were up about 80% on the year before the company reported earnings. Amazon had repeatedly impressed investors this year so, needless to say, expectations were high entering the quarter.