Amazon swung to a $3.8 billion loss in Q1 of 2022, though revenue beat Wall Street expectations at $116.4 billion.
However, it was the company’s forecast that sent the stock price down by as much as 10 percent in after-market trading. Amazon forecast Q2 revenue of $116 billion to $121 billion, compared to the Wall Street estimate of $125.5 billion. And in a lengthy statement abut the quarter, Amazon CEO Andy Jassy said that the company is transforming itself to meet the current moment after rapidly growing during the early days of the pandemic.
“The pandemic and subsequent war in Ukraine have brought unusual growth and challenges,” said Jassy. “Today, as we’re no longer chasing physical or staffing capacity, our teams are squarely focused on improving productivity and cost efficiencies throughout our fulfillment network. We know how to do this and have done it before. This may take some time, particularly as we work through ongoing inflationary and supply chain pressures, but we see encouraging progress on a number of customer experience dimensions, including delivery speed performance as we’re now approaching levels not seen since the months immediately preceding the pandemic in early 2020.”
And the company’s lucrative advertising business is feeling the heat too. The company ad business delivered $7.9 billion in revenue in Q1, up from $6.4 billion a year earlier, but still missing Wall Street expectations of $8.2 billion. Subscription services, which include Amazon Prime memberships, were $8.4 billion in the quarter.
Still, Amazon touted some of its entertainment assets in the quarter, including its MGM acquisition, telling investors that “the deal complements Prime Video and Amazon Studios’ work in delivering a diverse slate of original films and TV shows to a global audience and will create even more opportunities to deliver quality storytelling to customers.”
Other Prime Video-related news included touting the views for the trailer of its upcoming Lord of the Rings series, and its upcoming Thursday Night Football NFL broadcasts, which will be led by Al Michaels and Kirk Herbstreit
Amazon Web Services continued to be a strong point at the company, delivering revenue of $18.4 billion, and launching new products with clients like the National Hockey League, and Verizon.
This article was originally published by The Hollywood Reporter.