Amazon reported net income of $1.6 billion for the quarter ended March 31, 2017 (Q1 2018), more than double of the $724 million net income reported in the corresponding quarter last year. The company’s total revenues for the quarter stood at $51 billion, up 43% from $35.7 billion in Q1 2017. The company’s operating income also nearly doubled to $1.92 billion this quarter from around $1 billion in Q1 2017.

Driven by big investments in India the e-retail giant’s global losses grew 29% to $622 million compared to $481 million in the March quarter of 2017. The number, however, was lower than the $900 million peak from the December quarter (Q4 2017). The company’s international sales increased by 34.5% to $14.8 billion from $11 billion in the same period.

Amazon will continue to invest in India

Despite this, the company does not seem to be wavering in its plans in India, “We’ll continue to invest in India where we’re seeing great progress with both sellers and also customers. And we like the momentum we’ve seen there,” CFO Brian Olsavsky said during the earnings call. “The Prime program started in the first year in India grew faster than any Prime program we’ve seen in other countries. We’re adding local content in India, video content. We’re also adding other Prime benefits. We’re rolling out devices there, and we’re seeing Indian developers developing skills for Alexa,”

In his letter to shareholders last week, Jeff Bezos highlighted India as a ‘milestone’, stating that Amazon.in is the fastest growing marketplace in India. He also highlighted that Prime added more members in India in its first year than any previous geography in Amazon’s history. Prime selection in India now includes more than 40 million local products from third-party sellers, and Prime Video is investing in India original video content in a big way, including two recent premiers and over a dozen new shows in production, Bezos said in the letter. In Q1 2018, Amazon launched its Prime music streaming service in India, after introducing its Echo line of smart speakers.

Amazon Web Services

While Amazon Web Services (AWS) remains a relatively small segment of Amazon’s business in terms of net sales, it accounts for a huge portion of Amazon’s profits. AWS net sales came to $5.44 billion for the quarter and delivered operating income of $1.4 billion. To put that in perspective AWS accounted for 73% of Amazon’s operating income during the quarter.

“AWS had the unusual advantage of a seven-year head start before facing like-minded competition, and the team has never slowed down,” CEO Jeff Bezos said in a statement. “As a result, the AWS services are by far the most evolved and most functionality-rich. AWS lets developers do more and be nimbler, and it continues to get even better every day. That’s why you’re seeing this remarkable acceleration in AWS growth, now for two quarters in a row.”

But rival Microsoft is growing its cloud biz at a faster rate. Microsoft just reported that its Azure service grew 93% during Q1. Google, via parent Alphabet, just reported $4.35bn revenue in Q1, a 36% gain, for its Other category, which includes Google Cloud Platform and other businesses.

Other highlights

  • Amazon is raising its annual Prime membership fee from $99 to $119 beginning May 11 in the US. The new annual fee will apply to membership renewals beginning June 16.
  • Sales from subscription services, which include Prime, were $3.1 billion in the company’s first quarter — a 56% increase from the same time last year.
  • The company plans to increase its video content spending this year, Amazon’s Olsavsky said, with a prequel to “The Lord of the Rings” in the works.
  • Amazon’s “other” revenue, which primarily comes from its advertising business, saw a 139% increase from last year, generating $2.03 billion in sales.