• by Sarah Mahoney  @mahoney_sarah, August 4, 2023

The Seattle-based company attributed the impressive performance to growth in its cloud-computing business and strong consumer demand, including its biggest Prime Day event ever. And it continues to report explosive sales in its burgeoning advertising empire.

For the second quarter, net sales climbed 11% to $134.4 billion, compared with $121.2 billion in the second quarter of 2022. North America also gained 11%, with sales reaching $82.5 billion. In its AWS division, revenues increased 12% to $22.1 billion. And its ad sales division gained an astonishing 22%, to hit $10.68 billion.

Operating income more than doubled to $7.7 billion, compared with $3.3 billion in the second quarter of last year.

Amazon "delivered better than we hoped for," writes Lee Horowitz, an analyst who follows the company for Deutsche Bank. Besides bigger-than-expected improvements in sales and profits, gains in the AWS division are "the highlight of the quarter," showing that growth is stabilizing.

Horowitz adds that the company's comments about its aggressive advances in AI products are also encouraging. "CEO Andy Jassy went on the offensive, laying out Amazon's clear place within Generative AI, highlighting the many reasons why he expects AWS to lead the market forward in this next wave of computing."

In Amazon's advertising services division, where it continues to dwarf other retailers, the company says demand continues to be strong, "including the ramp up for 'Thursday Night Football' with the ability for advertisers to tailor their spots by audience and create interactive experiences for consumers."

Jassy also said Amazon continues to build delivery speed, with more than half of Prime member orders arriving the same or the next day.

And for the coming quarter, the company expects sales between $138 billion and $143 billion, representing 9% and 13% growth compared to last year's third quarter.

The news comes as Amazon continues to rethink its grocery strategy. The Washington Post, owned by Amazon founder Jeff Bezos, reports that it's eliminating hundreds of jobs in the Amazon Fresh division and facing real-estate lawsuits as it slows openings. In some cases, it's even ditching the banner’s signature "just walk out" check-out technology for plain old cash registers. And online, it's expanding grocery delivery to non-Prime members in key metro areas.