Amazon has reported a surprisingly positive third-quarter earnings report. The online retail giant made $79 million net profit in the three months to spetember, compared to a $437 million loss last year. Good news for Amazon and good news for its CEO Jeff Bezos, who now becomes the third-richest person in America and the fifth-richest in the world.
As a result of the company’s positive report, Amazon shares surged by almost 11 percent and have now doubled since the start of the year. This has meant Bezos, who owns 18 percent of Amazon, has added $5 billion to his personal wealth, taking his net worth to more than $55 billion dollars. He has now overtaken industrialists David and Charles Koch to become the third richest man in the US, leaving only Bill Gates and Warren Buffet richer than him.
Today, Jeff Bezos became the 3rd richest American. But aren't Amazon's margins too thin? Someone should let him know he's doing it wrong.— Chris Sacca (@sacca) October 22, 2015
Bezos’ fortune has grown 77 percent in 2015, thanks in no small part to the growth of Amazon’s cloud services, AWS. The $22 billion jump in wealth makes his the biggest yearly increase of all the individuals on the Bloomberg Billionaires Index, and is more than the combined gains of Facebook Inc's Mark Zuckerberg and Google founders Larry Page and Sergey Brin. He now becomes the fifth richest person in the world, up from 20th position last year.
Amazon had become known as a company that constantly made either tiny profits or huge losses, but these last two quarters have been good for the retailer. In the second quarter, Amazon reported a net income of $92 million, or an earnings per share of $0.19.
AWS has become a hugely important part of Amazon. Its operating profits grew from $98m to $521m in the quarter, with sales up 78 percent to $2bn. This makes the division almost as profitable as the North America retail unit, which had an operating income of $528 million.
Bezos was forced to defend Amazon in August, after a damning New York Times report described his company as having a demanding and degrading work environment which pushes employees to the limit. The CEO said he did not recognize the “soulless and dystopian” Amazon the piece portrayed. It certainly seems as if the negative publicity hasn’t adversely affected the company’s business.