Amazon 4Q23 Sales +14%, Operating Income +482% Y/Y

Feb 13, 2024 | Corporate Insights, No Bull Economics

As if Amazon’s quarter wasn’t sufficiently outstanding, the company is planning on expanding into medical services where it believes it can easily outperform an outdated healthcare system which requires consumers to schedule appointments far out in advance, drive 20 minutes to an appointment before waiting 15 minutes in an exam room to receive a prescription, & then driving even further to a pharmacy to pick up their prescription.

Amazon Net Sales


  • Strong 4Q23 revenue performance reflected solid results across all its segments.  
  • Consumers responded well to Amazon’s continued focus on selection, price & convenience offered on its online store platform. The broadest retail selection available includes fashion selections from Coach, Victoria’s Secret, Pit Vipers, Beyoncé Renaissance Merch as well as consumer tech from Boost, Infinite & Woop.
  • Notably, same-day or overnight deliveries increased +65% y/y, reflecting regionalization improvements which reduced transportation distances while also lowering delivery costs.
  • Healthy holiday sales were also evident by a +19% y/y increase in its third-party seller services during the quarter.  
  • A +26% increase in global ad revenue for sponsored products was driven by relevant machine learning ad placements.
  • A +13% increase in Amazon Web Services (AWS) revenues reflected the addition of early generative AI applications such as a coding companion (Amazon Q) which writes, debugs, & tests AWS code.
  • Prime Video (included in subscription services) is a large profitable business on its own, with the constant addition of exclusive content such as Thursday Night Football, Lord of the Rings, Reacher, Mr. & Mrs. Smith, Citadel & more. During the quarter, the company completed its second season of Thursday Night Football & the launch of its inaugural Black Friday football game which drove a +24% viewership increase & a sizeable increase in ad sales.

Grocery & Pharmacy Segment

  • Amazon was pleased with results from the “3 big macro segments” of its grocery business, including: nonperishables; health & beauty products; and pharmaceuticals.
  • Amazon is expanding its physical presence, with promising test results from its Fresh locations near Chicago & in Southern California.
  • Amazon Pharmacy seeks to gain market share by: leveraging its tech to store users’ healthcare data; and utilizing localized specialists to get consumers their medications in 1-2 days.


  • Amazon’s North American operating margin has increased for 7 consecutive quarters since bottoming in 1Q22.
  • The use of regionalized networks during the holiday period drove faster delivery speeds & lower costs. The company also benefited from lower transportation rates & a more stable labor market.
  • The cost to serve in the U.S. was down by more than $0.45 per unit y/y.
  • A +5% y/y increase in AWS’ operating margin was driven by a head-count reduction & a slowdown in the pace of hiring.

Amazon 4Q23 Financials

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