(CTN News) – As Amazon’s shares soared by 12% on Friday, following the company’s announcement of significant revenue growth for its second quarter and a solid view of its current quarter revenues, Amazon’s shares rallied on the news.
The earnings season for tech companies like Facebook was otherwise gloomy, but Amazon and Apple reported upbeat results.
Amazon shares jumped more than 12% on Friday after the company reported stronger-than-expected second-quarter revenue.
Sales for the three months ended in June increased 7% to $121.23 billion, which was higher than Wall Street’s expectation of $119.09 billion.
Amazon Shares has grown its revenues by a single digit every quarter for the last three quarters:
The third-quarter Amazon sales forecast suggested a reacceleration of 13% to 17%. According to Refinitiv, analysts were expecting a sales forecast of $126.4 billion, while the company projects revenue of $125 billion to $130 billion this quarter.
Despite a gloomy earnings season for tech companies, Amazon and Apple reported upbeat results. Inflation, rising interest rates and other macroeconomic pressures hurt Facebook parent Meta, Alphabet and Microsoft during the quarter.
Analysts called Amazon’s earnings report “a port in the macro storm” since the e-commerce giant appears to be weathering many of the headwinds challenging its tech peers.
According to Deutsche Bank analysts led by Lee Horowitz, Amazon provided investors with very clean 2Q earnings despite extreme macro-related earnings volatility across the industry. With a buy rating on Amazon shares, the firm raised its price target to $175 from $155.
Analysts said the results indicated Amazon was making progress on cost headwinds that have pressured the company lately.
In addition to labour and supply chain costs, Amazon faces costs related to energy, transportation, and the Covid-19 pandemic. indicated Thursday that the company is figuring out how to manage “the more controllable costs.”
Analysts at Goldman Sachs, led by Eric Sheridan, said that given a successful Prime Day event in July and management’s discussion of end demand concerns in its core businesses.
Amazon Shares is well positioned to grow revenue in 2H’22 [the second half of 2022]. Shares of the company were reiterated as buys by the firm.
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