Amazon Touts Successful Q4 to Close Out Fiscal 2017
SEATTLE, WA - We still await the turnaround numbers for how acquiring Whole Foods has impacted the bottom line for Amazon. In the meantime, the e-commerce turned grocery retailer is touting a successful close to fiscal 2017, including breaking the billion dollar profit milestone.
“Our 2017 projections for Alexa were very optimistic, and we far exceeded them. We don’t see positive surprises of this magnitude very often—expect us to double down,” said Jeff Bezos, Founder and CEO, in the financial report.
The company saw a net income of $1.9 billion in the fourth quarter, compared with net income of $749 million at the same point last year.
“We’ve reached an important point where other companies and developers are accelerating adoption of Alexa,” Bezos continued. “There are now over 30,000 skills from outside developers, customers can control more than 4,000 smart home devices from 1,200 unique brands with Alexa, and we’re seeing strong response to our new far-field voice kit for manufacturers. Much more to come and a huge thank you to our customers and partners.”
Fourth quarter highlights in addition to the above achievement included:
- A net sales increase of 38% to $60.5 billion in the fourth quarter, compared with $43.7 billion in fourth quarter 2016.
- Excluding the $1.1 billion favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 36% compared with fourth quarter 2016.
- Operating income increased 69% to $2.1 billion in the fourth quarter, compared with operating income of $1.3 billion in fourth quarter 2016.
Amazon also benefited from a provisional tax benefit in the fourth quarter 2017. The impact of the U.S. Tax Cuts and Jobs Act of 2017 was approximately $789 million, according to the report. As for Whole Foods having weighed in on the success, the company stated that the results exclude the impact of its recently-acquired grocer.
As for this coming fiscal year, net sales are expected to be between $47.75 billion and $50.75 billion, or to grow between 34% and 42%, compared with first quarter 2017. Operating income is expected to be between $300 million and $1.0 billion, compared with $1.0 billion in first quarter 2017 assuming “no additional business acquisitions, investments, restructurings, or legal settlements are concluded.”
In 2017, more than five billion items shipped with Prime worldwide with more new paid members having joined the program than any previous year—both worldwide and in the U.S.
Prime members were privy to particular deals through Amazon’s purchase of Whole Foods, which the Wall Street Journal previously reported as having helped to boost its grocery sales.
As we look to how this will affect Amazon’s business, and others in our industry, AndNowUKnow will continue to report the latest.