Amazon.com reported quarterly results above Wall Street's expectations last night, as interest in artificial intelligence helped drive cloud-computing growth.
Amazon's chief financial officer Brian Olsavsky told reporters on a call that capital spending would increase throughout the year, compared with $14 billion in the first quarter."That will be the low point for the year as far as capex by quarter," he said. Amazon is racing to keep abreast of rivals in offering generative AI software. Competitors include Alphabet as well as Microsoft-backed OpenAI.
"After a year and a half of cutting cloud costs, it appears that enterprise customers are ready to move more workflows to the cloud again, which is positive not just for Amazon, but also for many software companies that sell to enterprise customers," said DA Davidson analyst Gil Luria. AI has been a fixation in Silicon Valley since OpenAI's ChatGPT debuted in late 2022, fueling billions in funding and a mad dash to put chatbots and other artificially intelligent features into more products.
The company said its net income came to $10.4 billion, or 98 cents per diluted share, compared with $3.2 billion, or 31 cents per diluted share in 2023's first quarter. That beat analysts' average EPS estimate of 83 cents.