Shares of Amazon Jump on 1Q Earnings Beat

Shares in the company rose over 12 per cent in after hours trading after posting strong results, a quarter after having been pounded after profit missed the mark.

Amazon handily topped estimates for the first quarter as Amazon Web Services was more profitable than the North American e-commerce business, the company reported Thursday in its earnings report.

As usual, Amazon didn’t break out any new numbers for its hardware devices – despite launching a new Kindle (the Kindle Oasis) and two new Amazon Alexa-powered devices. After many quarters of investing in more and more fulfillment centers and cloud-based infrastructure, the chickens have come home to roost for Amazon in a big, positive way.

Shares of Amazon.com, Inc.

Operating income in the quarter was $1.1 billion, up from $255 million a year earlier.

Meanwhile, growth at its retail rivals is virtually nonexistent. The company also announced that its second original live-action children’s series, Just Add Magic, was its most successful Amazon Original Kids series to date. Meanwhile, revenues of Amazon Web Services, Amazon’s cloud service division, surged 64 percent to $2.57 billion. It’ll also give a hint to how Amazon’s shipping fee fluctuates this quarter.

Technology and content revenue was $3.5 billion, up from $2.8 billion in Q1 2015. However, analysts expect the margins to slightly drop in the near future due to increased long-term investments. Thus, Amazon’s quarter more resembles Facebook’s (FB – Analyst Report) blowout performance from yesterday than it does Alphabet’s (GOOGL – Analyst Report) disappointing one from a week ago. It gained 4.9% in 4QFY15 from 3.4% against the comparable quarter.

Although it’s still reporting tiny profits, Amazon passed $100 billion in annual revenue for the first time previous year.