Amazon's press release highlights the company's strong financial performance and customer experience improvements in 2023. The company's total revenue grew by 12% year-over-year (YoY) from $514 billion to $575 billion. North America revenue increased by 12% YoY from $316 billion to $353 billion, International revenue grew by 11% YoY from $118 billion to $131 billion, and AWS revenue increased by 13% YoY from $80 billion to $91 billion.
Operating income in 2023 improved by 201% YoY from $12.2 billion to $36.9 billion, with an operating margin of 6.4%. Additionally, Free Cash Flow (FCF) adjusted for equipment finance leases improved from -$12.8 billion in 2022 to $35.5 billion in 2023, marking an increase of $48.3 billion.
Amazon's customer experience improvements across its businesses are also notable. In the Stores business, the company saw an enthusiastic response from customers due to a relentless focus on selection, price, and convenience. Notably, customers saved nearly $24 billion across millions of deals and coupons in 2023, almost 70% more than the prior year.
The company also achieved significant milestones in delivery speeds, with more than 7 billion items delivered same or next day to Prime members in 2023. Additionally, the regionalization efforts led to a reduction in transportation distances, lowering the cost to serve globally on a per unit basis for the first time since 2018.
Amazon's Advertising progress remained strong, growing by 24% YoY from $38 billion in 2022 to $47 billion in 2023, primarily driven by sponsored ads. Moreover, the company expanded its streaming TV advertising by introducing ads into Prime Video shows and movies, reaching over 200 million monthly viewers.
In the AWS segment, substantial cost optimization was observed at the beginning of 2023, with the company helping customers use the cloud more efficiently. By the end of 2023, cost optimization attenuated, new deals accelerated, and migrations grew again. The company also announced the next generation of generalized CPU chips (Graviton4) and AWS Trainium2 chips, as well as the expansion of its AWS infrastructure footprint to 105 Availability Zones within 33 geographic Regions globally.
Looking ahead to 2024, Amazon aims to continue lowering its cost to serve and has identified areas where further cost reductions are possible while delivering faster for customers. Additionally, the company expressed confidence in its newer business investments, such as Prime Video and Project Kuiper, which aims to provide broadband connectivity to underserved households, governments, and enterprises.
Today the company's shares have moved 0.2% to a price of $186.26. Check out the company's full 8-K submission here.
