Profits tumble 28pc at Amazon’s Irish data hub despite revenue rise

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Gordon Deegan

April 16 2021 06:29 AM

PRE-tax profits at the data centre arm of Amazon’s Irish operation declined by 28pc to €28.5m last year.

Amazon Data Services Ireland Ltd recorded the drop despite revenues increasing 4.5pc from €2.48bn to €2.59bn in the 12 months to the end of December.

The company operates several data centres here and an Amazon-commissioned report has estimated that Amazon Web Services (AWS) has made a capital spend of €2bn on its network of data centres here over the past decade.

Numbers directly employed by Amazon Data Services Ireland Ltd last year increased from 1,575 to 1,747 and staff costs last year increased from €195.3m to €214.57m.

The company recorded an operating profit of €40.49m after the firm incurred administrative expenses of €2.55bn.

Amazon’s corporation tax charge for 2020 totalled €12.6m following a charge of €11.7m for 2019. Its shareholder funds last year increased from €904.76m to €1.44bn.

This came in the wake of the Gordon Deegan company receiving a capital injection of €430m from a connected Amazon company last year.

Profits last year take account of non-cash depreciation costs of €786.8m. They also takes account of research and development costs of €93m.

Findings from the Indecon report state that an analysis of AWS’s economic impact in Ireland shows that the company currently supports an estimated 8,700 jobs here.

This is made up of 3,100AWS employees, 3,900 working for contractors and a further 1,700 jobs in induced employment from these activities.

The report says that AWS’s investment in the Irish economy is estimated to generate economic output effects of over €4.5bn over the next three years.

Between 2011 and 2020, its operations here had a cumulative output of €7.5bn. The study estimates Amazon’s investment in the Irish economy for 2020 alone was expected to produce €1.45bn in additional economic output and will have an annual output of €1.5bn for this year, next year and in 2023.