Amazon announced that it now has more than 150 million paid Prime members worldwide.
CEO Jeff Bezos disclosed the figure in releasing Amazon’s fourth-quarter 2019 results, which again blew past Wall Street expectations. The company, which rarely releases such metrics, isn’t breaking out the number of Prime members by geography.
“We’ve made Prime delivery faster — the number of items delivered to U.S. customers with Prime’s free one-day and same-day delivery more than quadrupled this quarter compared to last year,” Bezos said in a statement. More people joined Prime in Q4 than any other quarter, he added.
In addition to free shipping on products, Amazon Prime members get access to thousands of titles on Prime Video, including the company’s originals. According to Bezos, Prime members watched twice the number hours of original movies and TV shows on Prime Video in Q4 compared to the year prior, though the company would not provide more info on viewing.
Bezos previously announced Prime had topped 100 million members in April 2018. With 150 million Prime members, Amazon is within shouting distance of Netflix, which reported 161.7 million paid subscribers as of the end of 2019. However, it’s unknown (by anyone except Amazon) how many Prime members actually watch Prime Video or how often.
In announcing Q4 earnings, Bezos also boasted that Amazon Studios originals received 88 nominations and 26 wins at major awards shows. That include eight Golden Globe Award nominations, with “Fleabag” taking home the trophy for musical or comedy TV series and series creator and star Phoebe Waller-Bridge winning the actress award in the category.
Other perks of Prime membership include free access to 2 million songs on Amazon Music; access subscriptions services including HBO, Showtime and Starz through Amazon Channels; Twitch Prime, which offers exclusive promotions on eligible pre-order games, one free channel subscription per month, and free access to exclusive game content; and two-hour grocery delivery from Amazon Fresh and Whole Foods Market in more than 2,000 U.S. cities and towns. In the U.S., Prime costs $119 per year.
Amazon reported revenue of $87.4 billion in Q4, up 21% year-over-year. Net income increased 8% to $3.27 billion in the fourth quarter, or $6.47 per diluted share. Analysts on average had expected sales of $86.0 billion and EPS of $4.03. The company’s shares popped more than 12% in after-hours trading on the massive beat.
Amazon said that during the 2019 holiday-shopping season, customers ordered “billions” of items worldwide, including “tens of millions” of Amazon devices. The company said its best-selling devices in the quarter were Echo Dot, Fire TV Stick 4K with Alexa Voice Remote, and Echo Show 5.
Meanwhile, in Amazon’s “other” segment which primarily comprises sales of advertising services, revenue grew 41% year-over-year, to $4.78 billion. The pace of growth in the AWS division slowed down slightly, to hit $9.95 billion in Q4, up 34% from the year-earlier quarter.
The growth of Prime memberships was primarily driven by the expansion of free one-day shipping — an initiative that Amazon has invested billions into since the second quarter of 2019. Total operating costs in Q4 were $83.56 billion, up 22% from the year-earlier quarter. CFO Brian Olsavsky previously told analysts that Amazon would incur a $1.5 billion cost hit in Q4 from the investment in free one-day shipping for Prime. On the earnings call Thursday, Olsavsky said that “penalty” was slightly under $1.5 billion; he forecast about $1 billion in costs associated with one-day shipping for Q1 2020.
In addition to the U.S., Amazon sells Prime members in countries including Canada, the U.K., Ireland, Germany, Austria, India, Japan, Italy, Spain, France, Mexico, Singapore, Australia, the Netherlands, Luxembourg, the United Arab Emirates, Brazil and Australia.
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