While it had projected it could lose that much, investors are selling off after another large quarterly loss.
A worker prepares an item for delivery at Amazon distribution center in Phoenix, Arizona.
Ralph D. Freso / Reuters
Amazon had a very Amazon third quarter — a 20% jump in sales along with sizable loss. The e-commerce behemoth had $20.58 billion in net sales in the third quarter, up from $17.09 billion a year ago. Its operating loss, however, was $544 million, compared to a $25 million loss a year ago.
While the size of the loss was well within Amazon's own projections, it was greater than what Wall Street analysts were expecting and investors are selling off. The stock is down 9.4% or $29.46 to $283.72 in after-market trading.
It's actually normal for Amazon investors to buy or sell violently following its earnings report. The stock has moved around 9% following quarterly earnings reports since 2007, according to a Wall Street Journal analysis.
Three months ago, Amazon projected losses between $410 million and $810 million thanks to spending on stock-based compensation for its employees, more spending on Amazon Web Services, and more investment in its fufillment and delivery infrastructure. It also projected that its total sales would be between $19.7 billion and $21.5 billion. The past quarter also saw a major acquistion that it didn't project: its nearly $1 billion purchase of the videogame streaming site Twitch.
"As we get ready for this upcoming holiday season, we are focused on making the customer experience easier and more stress-free than ever," Amazon Jeff Bezos said in a statement.
Going into the holidays, Amazon expects its sales will be between $27.3 billion and $30.3 billion, or up between 7% and 18% from last year and that it will have operating incomes between a $570 million loss and $430 million, with $470 million going to paying its employees in stock.
via IFTTT
No comments:
Post a Comment