Jeff Bezos, founder of Amazon

Katherine Taylor | Reuters

Amazon shares rose up to 4% in expanded trading Thursday after the company released its earnings for the first quarter, beating Wall Street’s earnings and revenue expectations.

Here’s how the e-commerce giant has performed compared to the analyst estimates produced by Refinitiv:

  • Merits: Expected $ 15.79 per share versus $ 9.54 per share
  • Revenue: Expected $ 108.52 billion versus $ 104.47 billion

Few companies have benefited from the online shopping pandemic as much as Amazon. The first quarter results showed that the company’s business continues to be sustained by the pandemic. Income rose 44% year over year to $ 108.5 billion.

Amazon’s second-quarter forecast assumes the momentum will continue, which should help allay investor fears that business could slow in a post-pandemic environment. The company expects sales between $ 110 billion and $ 116 billion, beating Wall Street’s forecast of $ 108.6 billion.

Crucially, Amazon has confirmed in its forecast that this year’s Prime Day will happen in June, which will likely help improve second-quarter sales comparisons from last year. Ordinarily, Amazon’s annual two-day discount bonanza takes place in July, but the company has postponed the event to last October due to the uncertainty surrounding pandemics.

Outside of the core retail segment, Amazon’s cloud computing and advertising business continues to boom. Amazon Web Services posted net revenue of $ 13.5 billion for the quarter, up 32% year over year. Amazon does not report ad sales, but is in the company’s “Other” category, where sales rose 77% year over year to $ 6.9 billion.

Jeff Bezos, Amazon’s CEO, also gave a rare glimpse into how the company’s streaming business has evolved during the pandemic, as stay-at-home consumers rely on online entertainment to keep them busy. “By the time Prime Video turns 10, over 175 million Prime members streamed shows and movies last year, and streaming hours were up more than 70% year over year,” he said.

Amazon’s streaming service, Prime Video, is a key offering on the company’s Prime subscription service, which costs $ 119 a year and includes a number of other perks like free two-day shipping. Bezos announced earlier this month that the company now has 200 million Prime subscribers, 50 million more than at the beginning of 2020.

Sales from physical stores, which include the Whole Foods Market, continued to decline. Revenue decreased 16% to $ 3.9 billion.

As expected, Amazon will incur fewer costs related to coronavirus security measures this year. Operating income is projected to be between $ 4.5 billion and $ 8 billion for the second quarter, assuming a $ 1.5 billion cost related to Covid-19. This is in line with the forecasts made by Amazon executives last quarter.

Amazon said Wednesday it would spend more than $ 1 billion raising wages for more than half a million of its U.S. operations workers. Speaking to reporters, CFO Brian Olsavsky said he had decided to raise the wage increase from fall to this spring as the volume remained at the same level as at the start of the pandemic.

Olsavsky declined to comment on the transition plans for Amazon’s CEO that will come into effect after Bezos’ resignation in the third quarter. Bezos will hand over the helm to AWS CEO Andy Jassy and assume the role of Executive Chairman of the Amazon Board of Directors.

This story evolves. Please try again.