Amazon has demonstrated exceptional performance in the third quarter, primarily driven by its robust cloud business, Amazon Web Services (AWS). The company's revenue soared by 11% to $158.9 billion, with AWS achieving a notable 19% growth. AWS, crucial for artificial intelligence development, generated $10.4 billion in operating profit from $27.5 billion in revenue, contributing significantly to Amazon's overall profit of $17.4 billion. This strong performance has been well-received by investors, resulting in a more than 5% increase in Amazon's stock price.
In contrast, Apple, despite surpassing market expectations with increased iPhone sales, faces challenges. The tech giant's revenue rose by 6% to $94.9 billion. However, a European Court ruling requiring a tax repayment of 13 billion euros impacted Apple's net profit, reducing it by 36% to $14.7 billion. Despite this, iPhone sales climbed by 5.5%, and services like the App Store and streaming services also showed significant growth.
Apple's approach to artificial intelligence appears less convincing compared to its peers. The company has rolled out its first generative AI system across its devices, but the broader integration will be gradual, according to Apple's CFO, Luca Maestri. The mixed reception of Apple's AI initiatives, combined with a slight dip in its stock price, highlights the challenges the company faces in the evolving tech landscape.
Both Amazon and Apple are investing heavily in AI and data centers, reflecting the industry's focus on these areas. However, while Amazon's cloud success has buoyed its fortunes, Apple's strategic moves in AI are yet to fully resonate with investors.
