Amazon online sales improve despite economy fears

Amazon's e-commerce business perked up in the three months to June, after months of lacklustre spending amidst a wider, sluggish economy.

The uptick follows a push by boss Andy Jassy to make the online shopping giant's delivery network run faster and more smoothly, the firm said.

It helped to drive overall sales up 11% year-on-year to a better-than-expected $134.4bn (£105.4bn).

Amazon's July Prime Day was its biggest ever, with 375 million items purchased.

The company surpassed analyst expectations, with quarterly profits of $6.7bn (£5.2bn), up from a $2bn loss a year earlier.

Though known for its online shopping operation, Amazon's financial results are driven far more by units such as its cloud computing business, called AWS, and - in more recent years - advertising.

The news comes as a string of other data suggests that some of the darkest clouds over the global economy may be starting to lift.

But the company's executives said consumers were still keeping a close eye on their budgets. Household budgets globally have been squeezed as prices rise at the fastest pace seen in decades, although have been showing signs of cooling recently.

The uptick in Amazon's ecommerce business is an "encouraging sign" for the rest of its year, said Insider Intelligence's principal analyst Andrew Lipsman.

Amazon's online sales rose 4% in the April to June period, after no growth at the start of the year, the company said.

It added that web service AWS's sales had stabilised, rising 12% year-on-year, whilst advertising revenue jumped 22% year-on-year.

Boss Andy Jassy said the results showed "another strong quarter of progress".

Even its international business, which was posting declines a year ago, reported sales growth, of roughly 10%.

The gains helped send Amazon shares up more than 6% in after-hours trade. The company's share price had already surged roughly 50% so far this year.

"As ever, Amazon's real strength comes from the breadth of its ecosystem," said Julian Skelly, managing partner at digital consultancy Publicis Sapient, Europe.

"Looking forward, the signs of slowing inflation and broader growth in the market suggest that we can hope for better-than-anticipated performance in the second half of 2023," Mr Skelly added.