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Amazon's Profits Surge 35% Amid Major AI Investments and ...
2025-08-01 04:40:09
Artificial Intelligence
Asia
Finance

Amazon's Profits Surge 35% Amid Major AI Investments and Challenges

Amazon has reported remarkable financial results, with a 35% increase in profit, reaching $18.2 billion in the second quarter, driven by substantial investments in artificial intelligence. The company’s revenue also surged to $167.7 billion, surpassing analyst expectations, particularly in its cloud sector, AWS, which grew by 17.5%.

CEO Andy Jassy emphasized the transformative potential of AI in enhancing customer experience, highlighting advancements in voice service and innovative shopping agents. Despite these successes, investor concerns about high AI expenditures led to a decline in Amazon's stock.

In an effort to adapt strategically, Amazon is investing $100 billion in AI this year but has also closed its Shanghai research lab due to geopolitical tensions. Meanwhile, other tech firms, like Reddit, are seeing growth through similar AI investments in advertising.

Related news on that topic:

Meta's Revenue Soars 22% as AI Focus Reshapes Future Strategy

Meta's recent quarterly results have exceeded expectations, with the company reporting a 22% increase in revenue, reaching $47.5 billion. This surge is attributed largely to increased advertising revenue and the strategic focus on artificial intelligence (AI). Meta's CEO, Mark Zuckerberg, emphasized the company's commitment to AI, highlighting its potential to enhance business performance and drive the development of personal superintelligence. Consequently, Meta's stock price saw a significant rise, reflecting investor confidence in this direction. The company's daily active user base has also grown, with 3.48 billion users across its platforms in June, marking a 6% increase from the previous year. Despite the focus on AI, Meta's investment in the metaverse continues, though the priority appears to be shifting. For 2025, the company plans to invest between $66 and $72 billion in AI infrastructure, aiming to bolster its capabilities in this area significantly. Overall, Meta's robust financial performance, coupled with its ambitious investment in AI, positions it well for future growth. The company's strategic pivot towards AI underscores its vision of harnessing technology to improve user engagement and business outcomes.

Meta's AI Ambitions: Superintelligence, Hiring Spree, and Job ... Concerns

Meta is strategically investing in artificial intelligence, with a particular emphasis on developing ‘superintelligence’ to enhance user experience. The company has raised its capital expenditure forecasts, reflecting its commitment to constructing data centers that support its ambitious AI projects. In the second quarter, Meta reported a remarkable 22% revenue increase, reaching $47.5 billion, alongside a 36% rise in profit, signaling strong business performance despite economic uncertainty. CEO Mark Zuckerberg envisions a future where users benefit from personalized AI assistants, and to this end, Meta is aggressively recruiting top talent from leading tech firms like Apple and Google. This hiring spree, however, has raised concerns among existing employees about job security amid the company's rapid restructuring. Furthermore, Zuckerberg indicated that not all AI models would be open-sourced, highlighting a cautious approach to risk management. As Meta continues to navigate the complexities of AI development, it aims to provide innovative tools that empower individuals, setting it apart from competitors focused solely on automation.

Read 1 more recent news on this topic

The press radar on this topic:

The Street
2. August 2025 um 11:10

Analysts revise Amazon stock-price targets ahead of Q2 earnings report TheStreet Daily Newsletter

Wedbush analysts have revised their Amazon stock-price targets ahead of the company's Q2 earnings report, expecting improved operating-income expectations and continued market-share gains. The firm maintained its outperform rating on Amazon and boosted its price target to $250 from $235. Other investment firms, including Stifel and Wells Fargo, have also raised their targets, citing favorable e-commerce trends and growing momentum in the cloud division.
TechCrunch
31. Juli 2025 um 22:13

Reddit revenue soars as it bets on AI and advertising

Reddit reported its second-quarter earnings, showing significant growth in revenue driven by advertising and AI-powered tools. The majority of its $500 million revenue came from ads, with $465 million attributed to ad sales. Additionally, the company saw a 24% increase in 'other revenue' due to data licensing deals with major AI players, including Google and OpenAI.
AFP
31. Juli 2025 um 23:28

Thanks to Investments in AI: Amazon Increases Profit by More Than a Third

Amazon achieved a profit of $18.2 billion in the second quarter, exceeding analysts' expectations. Revenue increased by 13% to $167.7 billion. The good business performance is attributed to massive investments in Artificial Intelligence (AI), for which Amazon plans to spend up to $100 billion this year.
New York Times - Business
1. August 2025 um 11:19

Amazon Reports Strong Retail Demand, but Says Future Is Less Clear

Amazon reported strong retail demand despite uncertainty over President Trump's trade war. Sales rose to $167.7 billion in Q2, with profit increasing 35% to $18.2 billion. Amazon forecast sales of $174-179.5 billion and operating profits between $15.5-$20.5 billion for the current quarter. The company's cloud computing service saw lower profit margins, while its e-commerce business reported a 12% increase in item sales.
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