What's going on?

Looks like Amazon’s investors got exactly what they’d ordered late on Tuesday: the ecommerce giant’s fourth-quarter results beat expectations.

What does this mean?

It was the success of Amazon’s two biggest businesses that drove last quarter’s strong performance: AWS – Amazon’s cloud computing segment – did typically well, while pandemic-fueled ecommerce growth sent the company’s retail business to new heights.


And the good news didn’t stop there: Amazon primed investors for another impressive quarter, saying it’ll earn 8% more in revenue than analysts are forecasting. There was a “but”, mind you: Amazon founder and CEO Jeff Bezos announced he’d be transitioning to the role of executive chair later this year. That’ll no doubt raise questions about the company’s future, and might be why its $1.7 trillion valuation barely climbed after the update (tweet this).

Why should I care?

The bigger picture: Retailers are trying to be more like Amazon.

One of the reasons Amazon’s so dominant in the ecommerce space is that it’s a “multi-brand” retailer, meaning it gives its customers a broader range of options than just Amazon-branded products. That’s a lesson British online fashion retailers ASOS and Boohoo seem to have learned too: they both expanded further past their eponymous brands last month, with the former buying Topshop and Miss Selfridge for $400 million, and the latter bankrupt retailer Debenhams for $75 million. The hope’s that those additions will bring in more customers and offer existing ones more choice, giving both companies’ growth a lasting boost.

For markets: Tech stocks aren’t done yet.

Analysts might’ve seen this promising update and upbeat forecast coming, and not just because Amazon’s been on a long run of form. The odds were in its favor after its Chinese ecommerce doppelgänger, Alibaba, announced its own better-than-expected quarterly earnings on Tuesday, along with a first-time profit for its cloud segment.