Unlocking Insights: AWS Quarterly Results Breakdown and 4 Key Takeaways
AWS recorded revenue of 26.3 billion, an increase of 18.8% year over year. Its annualized revenue run rate is over $105 billion. AWS's operating income was 9.3 billion, and its operating margin was around 35%.
AWS's operating income improved by 4 billion year over year, and the operating margin saw a 200 basis point favourable impact from the change in the estimated useful life of our servers, decreased payroll and related expenses and increased sales.
Capital expenditures were $16.4 billion in Q2 2024 and $30.3 billion for the six months ended June 30, 2024. The majority of capex was spent on AWS business growth.
AWS is tackling the GenAI market by building and offering products in the three layers of the GenAI stack.
Basic layer: The Company offers NVIDIA chips and their own Trainium for training and Inferentia for inference, with a newer version coming later this year. AWS SageMaker offers a platform to develop AI models.
Middle layer: Amazon Bedrock is a managed service where companies can choose from any popular model to build their GenAI applications. Bedrock has tens of thousands of customers.
Top layer: Amazon offers Amazon Q, a generative AI-powered assistant that provides code suggestions, identifies security vulnerabilities, and offers comprehensive software development assistance.
By migrating 30,000 Java JDK applications with Q, the company saved $260 million and 4,500 developer years. AXA, DoorDash, Nasdaq, Rocket Insurance, SAP, Thomson Reuters, Workday, WPP, and Zendesk are building applications using Bedrock.
Business Highlights
The Company signed AWS agreements with Commonwealth Bank of Australia, Databricks, Discover Financial Services, Eli Lilly and Company, Experian, GE HealthCare, NetApp, Scopely, ServiceNow, Shutterfly, and AI startups Perplexity, H Company, and Observea.
AWS signed an AUD $2 billion strategic partnership with the Australian Government to provide a “Top Secret” AWS Cloud to enhance the nation’s defence and intelligence capabilities.
Key Takeaways
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