Amazon shares surge on strong earnings update

Amazon shares shot higher Thursday after the internet colossus released quarterly earnings figures for the holiday quarter that trounced market expectations.

Profit in the final three months of last year rose eight percent from 2018 to $3.3 billion, as revenue grew 21 percent to $87.4 billion, according to the Seattle-based firm.

A record number of people signed up in the last quarter for Amazon Prime, a service that provides perks from one-day delivery to streaming television and music, according to Amazon chief executive Jeff Bezos.

"We now have over 150 million paid Prime members around the world," said Bezos.

Amazon has expanded from its original mission as an online retailer and now is a major force in cloud computing, and its AI-powered digital assistant Alexa has been incorporated into thousands of consumer products.

It also operates one of the largest streaming video services and recently announced that its streaming music service has gained more than 55 million subscribers, closing in on Apple Music.

Amazon has also been spending big on original content for its Prime service, which faces Netflix, Disney+, Apple TV+ and other rivals in an increasingly competitive streaming television market.

Shares in Amazon surged 10 percent in after-hours trade after the better-than-expected report, a jump likely to lift the value of the tech giant to over $1 trillion. "Amazon blew all expectations out of the water during the holiday quarter," said Andrew Lipsman of the research firm eMarketer, noting that the rollout of next-day Prime delivery helped momentum.

Patrick Moorhead of Moor Insights & Strategy was also upbeat on the results, pointing to the 34 percent revenue growth for the cloud computing unit AWS: "It generated nearly $10 billion in quarterly revenue and 67 percent of the entire company's operating income."