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Amazon shares surge after surprise profit report

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Amazon shares rocketed higher on Thursday after the online giant surprised the market by swinging to profit in the second quarter amid surging sales.

[SAN FRANCISCO] Amazon shares rocketed higher on Thursday after the online giant surprised the market by swinging to profit in the second quarter amid surging sales.

The US e-commerce giant, which is also a major player in online video and cloud computing, reported a net profit of US$92 million while revenues jumped 20 per cent from a year ago to US$23.18 billion.

Amazon shares vaulted 17 per cent in after-hours trade to US$568. Analysts had been expecting a net loss for the Seattle-based firm.

The company founded by Jeff Bezos has been known for investing in long-term projects with little concern for short-term profits, but some of those investments appear to be paying off.

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"The teams at Amazon have been working hard for customers," said Bezos, who cited the company's diverse offerings including Emmy-nominated television shows, a voice-controlled personal assistant and a range of cloud computing services.

Amazon Web Services, the cloud computing division, was a big factor in the results, showing a revenue jump of more than 80 per cent to US$1.8 billion in the three months to June 30, and accounting for US$391 million in operating income.

North American sales, which are the largest segment for Amazon, rose 25 per cent to US$13.8 billion.

Amazon also offered a better-than-expected outlook for the current quarter, predicting revenues in the range of US$23.3 billion to US$25.5 billion.

AFP

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