Some days, it feels like it’s Amazon’s world and the rest of e-commerce is just trying to find a way to sell in it.
Thursday was definitely one of those days, as the e-commerce giant closed the books on 2023 with big fourth-quarter gains.
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As usual, the company offered up a very long list of its initiatives with its numbers, a quarterly display of corporate power and focus on innovation that helps illustrate just how hard everyone else has to work to keep up.
Here, six highlights from Amazon’s latest.
Earnings, Lots of Earnings
Amazon’s fourth-quarter net income jumped to $10.6 billion on a 13.9 percent increase in revenues, to $170 billion. Earnings per diluted share came in at $1, which was 20 cents better than the 80 cents analysts projected, according to FactSet.
For the full year ended Dec. 31, Amazon logged profits of $30.4 billion on $256 billion in product sales and $319 billion in service sales.
The Word From the Top
“This Q4 was a record-breaking holiday shopping season and closed out a robust 2023 for Amazon. While we made meaningful revenue, operating income and free cash flow progress, what we’re most pleased with is the continued invention and customer experience improvements across our businesses.
“The regionalization of our U.S. fulfillment network led to our fastest-ever delivery speeds for Prime members while also lowering our cost to serve…our advertising services continue to improve and drive positive results.…As we enter 2024, our teams are delivering at a rapid clip, and we have a lot in front of us to be excited about.”
— Andy Jassy, Amazon, chief executive officer
The Black Friday Run
In the 11 days leading up to Cyber Monday, which includes the week of Thanksgiving, shoppers bought more than 1 billion items on Amazon, including more than 500 million from independent sellers.
An AI Eye on Fashion
In fashion, Amazon introduced AI-powered size recommendations, Fit Review Highlights offering personalized feedback from other customers and new size charts.
The company said it also “developed a Fit Insights Tool to help brands and selling partners better understand customer fit issues and incorporate feedback into future designs and manufacturing.”
Standardizing fit has been an unrealized dream of fashion’s for decades. And in the age of online selling, the issue of fit has involved into a major cost center given the high rate of returns. Amazon is betting AI can finally help solve fit.
Amazon also started testing Rufus, a “generative AI-powered conversational shopping experience.” The shopping assistant has been trained on Amazon’s massive product catalogue and consumer information from across the web.
“Customers can simply start typing or speaking their questions into the search bar in the Amazon Shopping app, or choose from a set of pre-populated questions, and Amazon will provide answers via a chat dialogue box to help customers make more informed purchase decisions,” the company said.
Shares of Amazon gained 8.5 percent to $172.87 in after-hours trading, giving the company a market capitalization of $1.8 trillion.
Neil Saunders, managing director of GlobalData, said: “What differentiates Amazon from many other players is that the cost cutting has not been a knee-jerk reaction to difficult times and a slowdown, but rather has been accompanied by strategies to boost sales. This has given Amazon the best of both worlds and is one of the underpinnings of its very strong and balanced performance.”
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