Amazon, the e-commerce giant, had a stellar quarter at the end of 2023, as it reported revenue of $170 billion, a 14% increase from the same period last year. The company also launched Rufus, an AI shopping assistant, to help customers find the best products and deals online.
Rufus: Amazon’s New AI Shopping Assistant
On Thursday, the same day it announced its earnings, Amazon introduced Rufus, an AI shopping assistant that uses generative AI technology to help customers discover items in a new way. Rufus is trained in Amazon’s vast product catalogue, customer reviews, community Q&A, and the broader web.
During a call with analysts, Amazon CEO Andy Jassy said that Rufus “lets customers discover items in a very different way than they have been able to on an e-commerce website.” Rufus is already accessible on the Amazon app in beta to a select few users, but it will be made available to more US users in the upcoming weeks.
Jassy also said that generative AI is a key investment area for the company, as it expects it to generate “tens of billions of dollars of revenue for AWS” in the future. AWS, Amazon’s cloud computing division, saw its revenue grow 13% to $24.2 billion last quarter.
Amazon’s Cost-Cutting Measures Pay Off
The enhanced financial position of Amazon, as evidenced by its remarkable revenue and profit growth in the fourth quarter of 2023, is consistent with its performance the previous year.
. At the start of 2023, Amazon faced challenges such as geopolitical uncertainty, macroeconomic headwinds, higher inflation, and a surge in demand for e-commerce due to the pandemic. Jassy implemented aggressive cost-cutting measures to cope with these challenges, including multiple mass layoffs.
Amazon reported profits of $10.6 billion for the last quarter of 2023 and said its advertising revenue grew 27% year-over-year. The company also gave optimistic guidance for the current quarter, expecting revenue of $162 billion to $166 billion.
Following the earnings report, Amazon’s stock rose more than 7% in after-hours trading on Thursday. Amazon, one of the “Magnificent Seven” tech stocks, has seen its shares soar nearly 90% since hitting a low of $84 in December 2022, when fears of recession, inflation, and interest rate hikes hit the tech sector.
Jesse Cohen, senior analyst at Investing.com, said in a note that “despite all the concerns plaguing the tech sector, Amazon has managed to perform surprisingly well.” He added that “the results indicate that ongoing cost-cutting measures are positively impacting Amazon’s business prospects.”
Amazon’s holiday quarter showed that the company is a leader in e-commerce and AI innovation. With Rufus, Amazon hopes to give customers a new and better way to shop online while boosting its revenue and profitability.
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