The company reported earnings per share of $6.47 for the quarter, easily beating forecasts of $4.04 per share. Net sales increased 21% to $87.4 billion in the fourth quarter. Net income grew to $3.3 billion ($6.47 per diluted share) in the fourth quarter, up from $3 billion ($6.04 per diluted share) in the fourth quarter 2018.
For the full year net sales increased 20% to $280.5 billion, and when the $2.6 billion unfavorable impact from year-over-year changes in foreign exchange rates throughout the year is excluded, net sales increased 22% compared with 2018. And net income for the full year increased to $11.6 billion (or $23.01 per diluted share), up from $10.1 billion ($20.14 per diluted share) in 2018.
Prime membership rates have also shown strong growth, according to the company, which sees that metric as a key indicator of customer loyalty.
“Prime membership continues to get better for customers year after year,” Amazon chief executive Jeff Bezos said in a statement. “And customers are responding — more people joined Prime this quarter than ever before, and we now have over 150 million paid Prime members around the world.”
Bezos added that Amazon has invested in making its Prime membership more compelling.
“We’ve made Prime delivery faster — the number of items delivered to U.S. customers with Prime’s free one-day and same-day delivery more than quadrupled this quarter compared to last year,” he said. “Members now have free two-hour grocery delivery from Amazon Fresh and Whole Foods Market in more than 2,000 U.S. cities and towns. Prime members watched double the hours of original movies and TV shows on Prime Video this quarter compared to last year, and Amazon Originals received a record 88 nominations and 26 wins at major awards shows. A huge thank you to teams across Amazon for their dedicated work to build, innovate, and deliver for customers this holiday.”
One comparative weak spot was Amazon’s physical stores, including its Whole Foods Market chain, which posted sales of $4.36 billion for the fourth quarter, down 1% compared to the prior year period. And while its Amazon Web Services division posted a 34% sales gain for the quarter, that is weaker than the 46% growth the division posted in last year’s fourth quarter.
Amazon’s first quarter guidance calls for net sales of between $69.0 billion and $73.0 billion, which would represent growth of between 16% and 22% over the first quarter of 2019. (The forecast is based on assumptions that include a a favorable impact from foreign exchange rates of about 5 basis points,) Operating income for the first quarter is expected to be between $3.0 billion and $4.2 billion, down from $4.4 billion in first quarter of 2019.