Amazon Hikes Cost Of Prime As Stock Surges To Record High
Amazon (AMZN) delivered a monster first quarter earnings report, sending the stock soaring after hours to a record high.
The Seattle-based company reported a 43 percent jump in revenue to $51 billion. Net income totaled $1.6 billion, up from $724 million in the same period a year earlier.
The company plans to increase prices for its U.S. Prime subscription service to $119 from $99 per year. The change will take effect May 11 for new customers and June 16 for customers renewing subscriptions. There are more than 100 million paid Prime subscription members globally, Amazon CEO Jeff Bezos said earlier this month.
"We always evaluate the price of Prime," Amazon CFO Brian Olsavsky said on the call, adding that the price had not increased since 2014. "There's all kinds of new features we've continually added to the Prime program...it's a reflection of the cost value of the program," he said.
Amazon's cloud-based services, called Amazon Web Services, were a bright spot, with revenue up 49 percent to $5.4 billion. The segment provides cloud computing, database and storage services for developers, academic institutions and governments.
In a statement, Bezos called out the division. "AWS had the unusual advantage of a seven-year head start before facing like-minded competition, and the team has never slowed down," Bezos said.
Amazon's stock jumped more than 6 percent to nearly $1,613 a share.
The Associated Press contributed to this report.
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