(31 January 2020)DAILY MARKET BRIEF 1:Amazon Revenue Jumps on Holiday Sales as Profit Rises

Amazon.com Inc.'s fourth-quarter sales blew past a previous record as robust holiday sales and profit from cloud and advertising businesses helped offset growing shipping costs for its one-day Prime program. The Seattle company's shares jumped more than 10% in after-hours trading, adding about $100 billion to the company's market value. Should the stock keep the gains Friday, Amazon would be the fourth U.S. company to finish with a market cap above $1 trillion. Profit rose 8% to $3.3 billion during the all-important holiday quarter, after sliding more than 25% from July to September due to its costly one-day shipping effort for Prime members. The company beat its quarterly profit estimate of between $1.2 billion and $2.9 billion. Earnings per share were $6.47, compared with analyst estimates of $4.04 a share, according to a survey by FactSet. Amazon's fourth-quarter revenue rose 21% to $87.4 billion from a year earlier. "There was investor concern that one-day shipping would be a drag to margins, so the fact that they have been able to offer one-day shipping and also at the same time drive some efficiency has to please investors, " Raymond James analyst Aaron Kessler said.

By Ipek Ozkardeskaya