Amazon's fourth-quarter revenue was 1699$6.1 billion
It's hard to believe that Amazon's fourth-quarter fiscal 2023 results soared, higher than expected.
What exactly does Amazon do?
A few days ago, Amazon released its fourth quarter and full-year report for fiscal year 2023. According to the report, Amazon's net sales in the fourth quarter were 1699US$6.1 billion, a year-on-year increase of 14%; Net profit reached 106$2.4 billionNet profit compared to the same period last year was 2That's a significant increase of more than 37 times compared to $7.8 billion.
Diluted earnings per share were 1$00, compared to diluted earnings per share of 003 USD compared to a significant increase.
Amazon's net profit attributable to the parent Source: **Tong.
Both the fourth-quarter and full-year results were better than analyst expectations.
Looking at the full-year results, for the entire fiscal year 2023, Amazon's net sales will be $574.8 billion, a year-on-year increase of 12%. Among them, the sales of the North American segment were 352.8 billion US dollars, a year-on-year increase of 12%; International segment sales were $131.2 billion, up 11% year-on-year; AWS sales were $90.8 billion, up 13% year-over-year.
In addition, net profit attributable to ordinary shareholders was 3042.5 billion US dollars, a year-on-year increase of 121774%。
After the earnings report was announced, Amazon's U.S. value and stock price were obvious. As of February 1 local time**, Amazon News159.$280, up 263%, market capitalization 1$65 trillion, Amazon's U.S. stock rose nearly 8% after hours.
Source: **Tong.
Specifically, Amazon's revenue includes online stores, physical stores, third-party seller services, subscription services, advertising, AWS (web services cloud computing business), and others.
In the fourth quarter, Amazon's net sales from all businesses were all varying year-over-year**. Of this, net sales from advertising services were 146US$5.4 billion, an increase of 27%, is also the largest growth rate of all business revenues. This was followed by net sales from third-party sellers at 435$5.9 billion, up 20% year-on-year. In addition, the net sales growth rate of subscription services and AWS cloud services exceeded 10%.
On the contrary,The largest contributor to revenue** stores had net sales of 705$4.3 billion, with a growth rate of only 9% in the single digits. At the same time, net sales from brick-and-mortar stores were 51$5.2 billion, up 4% year-over-year.
Source: Finance Eleven.
Overall, in the fourth quarter and throughout 2023, Amazon has achieved significant growth in revenue and profit. This earnings report is something to be happy for Amazon. After all, in 2022, Amazon will face a net loss for the first time in 7 years. The revenue growth rate of all businesses has slowed down significantly, and even at the end of 2022, Amazon's stock price fell from $170 to $84, a 55% decline from its peak.
Earlier, in 2021, the crisis of Amazon's business slowdown and the initial appearance. Now that all performance has begun to return to growth in 2023, Amazon is relieved.
Amazon CEO Andy Jassy said: "The fourth quarter was a record-breaking holiday shopping season and a great 2023 for Amazon. We made significant progress in revenue, operating margin and free cash flow, and we are most pleased with the company's continued innovation and improvement of the customer experience across all areas of our business. ”
Amazon saves itself
Amazon has put a lot of effort into achieving this achievement.
At the beginning of February last year, Amazon released the company's fourth quarter and full-year financial results for fiscal 2022. According to the financial report, net sales in the fourth quarter increased by 9% year-on-year, but net profit was 2$7.8 billion, compared with net profit of 143 in the same period last year$2.3 billionUp to 98%.
At the same time, the net profit loss for the whole year of 2022 was $27, which was the first time since 2014 that it turned from a profit to a loss, and it was also the worst result in history. According to the report, Amazon attributed its 2022 loss to its investment in electric vehicle startup Rivian.
Of course, Amazon's crisis also comes from the impact of many factors such as the macroeconomic downturn and the return of consumers to offline physical stores after the end of the epidemic.
The decline in profits was accompanied by a sharp drop in stock prices and a shrinking market value, and in this regard, Amazon, which was facing a crisis, began to save itself. The first is to reduce costs. In the fourth quarter of 2022, Amazon began to control costs by closing some stores, cutting projects, and freezing recruitment.
At the beginning of last year, Amazon began to carry out multiple rounds of layoffs, involving a wide range of departments, such as retail, equipment, human resources, and games, and even lucrative departments such as cloud computing and advertising are also facing layoffs, with more than 27,000 presidents in the past year.
At that time, Amazon CEO Andy Jassy (Andy Jassy) also issued a statement on the company**, saying that Amazon has hired a large number of employees in the past few years, but the uncertain economic outlook has forced the company to choose to cut costs and personnel. The company plans to make a final decision by mid-to-late April (2023) and notify the redundant personnel.
In addition to layoffs, Amazon has also shut down a number of businesses. Last October, Amazon shut down its subsidiary, Fabric., which it acquired in 2008com。In addition, Amazon has also successively closed a number of projects such as telehealth services, U.S. call centers, and delivery robots, closed physical chain stores with poor performance, and postponed the construction of multiple warehouses and distribution centers.
In response to slowing sales growth and rising costs, Amazon has significantly increased its platform commission. According to Marketplace Pulse research data, in 2022, Amazon started with every transactionFor the first time, the average percentage of fees charged in sales exceeded 50%.
In September last year, Amazon and Shopify reached a partnership to provide Shopify merchants with the Buy With Prime service, allowing sellers to use Amazon's checkout and fast shipping services after paying a fee.
Amazon is also expanding its traffic channels. In November last year, Amazon announced that it had reached advertising cooperation with Facabook, Instagram, and Snapchat, allowing users to check out directly without jumping to Amazon on these social networks**, which greatly shortened the shopping link and made it easier for users to place orders.
After continuous efforts, Amazon's performance has finally increased significantly. According to Amazon's financial report for the third quarter of fiscal year 2023, the financial report shows that Amazon's total net sales in the third quarter were $143.1 billion, a year-on-year increase of 13%; Net income was $9.9 billion, up 241% from $2.9 billion in the same period last year.
Amazon CEO Andy Jassy said that the company achieved strong business growth in the third quarter, as an e-commerce platform to achieve significant cost reduction and improved delivery speed, AWS cloud service growth is becoming more and more stable, advertising revenue growth is amazing.
From the current point of view, Amazon has come out of the trough and entered a new stage of development.
In terms of recent actions, Amazon recently officially issued a notice of overseas purchase revision, announcing the official closure of Amazon China (Amazon.).cn) Computer-based services, users will not be able to place orders and purchases through the computer-side website.
At the same time, Amazon has also launched a new version of the "Amazon Shopping" app, which incorporates more localized elements and page design, making the shopping experience more efficient and smooth. Customers can continue to shop overseas goods with preferential prices** and experience fast international delivery services.
Go to sea and besiege the Amazon
Although Amazon's business is currently performing well and it is the world's largest cross-border e-commerce platform, its global position is facing the threat of China's four tigers.
The so-called four tigers who go to sea are temu, shein, tiktok, and AliExpress. In recent years, especially in 2023, these four cross-border e-commerce platforms are taking the global market by storm at a breakneck speed.
In September 2022, Temu, a cross-border e-commerce platform on Pinduoduo, was officially launched in the North American market, and only one month after its launch, Temu topped the list of shopping apps in the United States.
A year later, Douyin's overseas short ** platform TikTok also officially launched the e-commerce service TikTok Shop in the United States. To engage in e-commerce business in the U.S. market, TikTok's advantages are not small. You know, the U.S. market is the market with the largest number of TikTok users. According to data disclosed by TikTok in March last year, TikTok has as many as 1. active users in the United States500 million, almost half of the population of the United States. As of September last year, the number of TikTok Shop small stores in the United States has reached 180 thousand.
In terms of SHEIN, starting in 2023, SHEIN has been frequently exposed to the news of going public in the United States, with a valuation of $90 billion. According to Bloomberg Second Measure, as of November 2022, SHEIN has accounted for about half of fast fashion sales in the United States.
According to dataAI's latest "2024 Mobile Market Report" shows thatShein once again won the 2023 global shopping APP** volume, with Temu, Amazon, and AliExpress ranking second, third, and ninth in 2023 shopping APP** volume, respectively.
data.Another list of AI shows that in the first three quarters of 2023, Temu, Shein, AliExpress (AliExpress), and TikTok Seller have become the fastest growing shopping apps in the global market.
The top four of the Four Dragons of the Sea 2023 Global Shopping App ** list Source: dataAI reports.
In fact, compared to SHEIN and AliExpress, Amazon is more worried about the threat from Temu and TikTok.
In the past year or two, both Temu and TikTok have resorted to low-price wars and marketing wars to quickly capture market share.
During last year's Black Friday, four cross-border e-commerce platforms all joined the "Black Friday" promotion in the United States. Under the fierce competition, all major platforms have extended the ** time, forcing Amazon to also extend the ** cycle from 5 days to 10 days.
From the perspective of sellers, with the rapid expansion of Pinduoduo Temu and Douyin TikTok, a large number of sellers have left Amazon and poured into these two platforms.
Perhaps afraid of the loss of a large number of sellers, in December last year, Amazon began to reduce sales commissions and logistics fees, stipulating that from January 15, 2024For apparel products priced below $15, the referral fee will be reduced from 17% to 5%; For apparel items priced between $15 and $20, the referral fee will be reduced from 17% to 10%.
Overall, although the overall scale of the four tigers at the current stage has not yet been compared with Amazon, the growth momentum is rapid. A new competitive landscape has been formed, and the prelude to a fierce global market competition is kicking off.
Author |Zhou Wenjun.