Amazon reports record quarterly profit and 40% sales growth backed by strong COVID-related demand

• Amazon reported a huge beat across the board for its second quarter earnings on Thursday.
• The results show how Amazon is proving to be one of the biggest beneficiaries of the COVID-19 pandemic, as more people shop online and businesses increase their cloud computing usage.
• Amazon had $5.2 billion in net profit, after having warned it would spend all of the $4 billion it was expecting to make for the quarter on COVID-related initiatives.

Amazon reported a huge beat across the board for its second quarter earnings on Thursday, driven by strong COVID-related demand.

Amazon stock was up by as much as 6% in after-hours trading.

Sales for the quarter jumped a whopping 40% from last year, to $88.9 billion. Net profit doubled from the year-ago period to a record $5.2 billion.

The results show how Amazon is proving to be one of the biggest beneficiaries of the COVID-19 pandemic, as more people shop online and businesses increase their cloud computing usage.

Here are the most important numbers:

• EPS (GAAP): $10.30 versus expectations of $1.50 per share
• Revenue: $88.9 billion versus expectations of $81.24 billion
• AWS: $10.81 billion versus expectations of $11.01 billion

"This was another highly unusual quarter, and I couldn't be more proud of and grateful to our employees around the globe," Amazon CEO Jeff Bezos said in a statement.

Amazon's net profit far exceeded street expectations, as the company had previously warned that it would spend all of the $4 billion in projected second quarter income on COVID-related initiatives.

Amazon's CFO Brian Olsavsky said during a press call on Thursday that the higher profit was largely due to the increased sales of more profitable products and shipments of more units. Amazon's paid unit, or products sold on its site, grew 57% for the quarter, while online sales jumped 49%, both more than tripling the growth rate from last year.

Olsavsky also highlighted the continued growth of Amazon's high-margin businesses, like its cloud computing and advertising segments. Amazon Web Services surpassed $10 billion in quarterly revenue, but its growth rate dipped below 30% for the first time, to 29%, slightly below street estimates.

The increased demand helped boost Amazon's international sales too. Revenue from Amazon's overseas marketplaces jumped 38% to $22.7 billion, a huge bump from the year-ago period's 12% growth rate. That resulted in a rare profit for its international business during the quarter.

Amazon's annual Prime Day shopping event will be held in the fourth quarter, Olsavsky added. For the current quarter, Amazon expects to generate revenue in the range of $87.0 billion and $93.0 billion, above the $86.5 billion street consensus estimate. Operating income is expected to be between $2 billion and $5 billion.

Amazon plans to spend another $2 billion on COVID-related initiatives this quarter, on top of the roughly $4 billion it spent last quarter.

Bezos said earlier this week that Amazon now directly employs over a million people.