**Key Financial Insights: Amazon vs. Alphabet**
In the second quarter of 2023, Amazon reported net income of $62.6 billion, a significant increase from $18.2 billion the previous year. This spike was largely attributed to a pre-tax non-operating income of $53.4 billion stemming from investments in Anthropic. Amazon’s operating income rose 43% year-over-year to $27.5 billion, while Amazon Web Services (AWS) revenue grew 37% to $42.2 billion, marking its fastest growth in 18 quarters.
Conversely, Alphabet’s net income soared 298% to $112.2 billion, primarily due to $98 billion in other income from unrealized gains on its equity securities, which include stakes in SpaceX and Anthropic. Alphabet’s revenue for the quarter grew 24% to $119.8 billion, with operating income climbing 30% to $40.8 billion. Both companies are significantly ramping up their capital investments, with Amazon planning approximately $220 billion and Alphabet up to $205 billion for the year.
Current earnings multiples show Amazon trading at about 22 times earnings and 30 times forward earnings, while Alphabet trades at about 18 times earnings and 27 times forward earnings. Despite Amazon’s impressive revenue and operating income growth, Alphabet is viewed as better valued among the two, given its enhanced operating margin and lower forward multiples.
5 Stocks Our Experts Predict Could Double In the Next Year
By submitting your email, you'll also get a free pivot & flow membership. A free daily market overview. You can unsubscribe at any time.
