Amazon, After a Busy Third Quarter, Posts Lower-Than-Expected Earnings
Shares of Amazon.com Inc. fell in after-market trading on Thursday after the online retailer reported third-quarter net income that missed analyst expectations. The Seattle-based company said it had profit of $252 million, or 52 cents per share. The average estimate of 15 analysts surveyed by Zacks Investment Research was for earnings of 85 cents per share.
The online retailer posted revenue of $32.71 billion in the period, which topped Street forecasts. Twelve analysts surveyed by Zacks expected $32.57 billion.
In a statement, CEO Jeff Bezos touted the breakout success of Echo, the smart speaker powered by voice assistant Amazon calls Alexa. “Alexa may be Amazon’s most loved invention yet — literally — with over 250,000 marriage proposals from customers and counting. Because Alexa’s brain is in the cloud, we can easily and continuously add to her capabilities."
Over the past quarter, Amazon debuted its Amazon Music streaming service, which it almost immediately bolstered by striking an exclusive streaming deal for Garth Brooks' catalog. As well, the company's video series and movies, like Transparent, have been well-received by critics.
For the current quarter ending in December, Amazon said it expects revenue in the range of $42 billion to $45.5 billion. Analysts surveyed by Zacks had expected revenue of $44.7 billion.
Amazon shares have increased 21 percent since the beginning of the year, while the Standard & Poor's 500 index has increased slightly more than 4 percent. In the final minutes of trading on Thursday, shares hit $821.01, a climb of 34 percent in the last 12 months.
Shares fell $46.51, or 5.7 percent, to $771.93 in aftermarket trading.