Amazon's stock dropped by up to 6% in after-hours trading following the company's release of third-quarter sales guidance that fell short of analyst estimates. The company forecasted sales between $154 billion and $158.5 billion, below the $158.43 billion expected.
Despite exceeding earnings per share (EPS) estimates with $1.26 against the anticipated $1.04, and doubling profits from the same period last year, the focus remained on the sales guidance miss.
Amazon reported $148 billion in revenue, slightly below the $148.8 billion expected, with its advertising segment also missing expectations at $12.8 billion versus the $13 billion forecasted.
However, Amazon Web Services (AWS) performed well, generating $26.3 billion in revenue, surpassing the $26 billion estimate and the $22.1 billion from the previous year.
Amazon CFO Brian Olsavsky highlighted the company's significant investment in AI and cloud services infrastructure, with over $30 billion spent on capital expenditures in the first half of the year.
Increased competition from companies like Temu and Shein in the ecommerce space has led Amazon to develop its own discount digital storefront to capture fashion and lifestyle spending.
Other Big Tech companies have also faced scrutiny, with Microsoft's cloud revenue missing expectations and Alphabet's YouTube ad revenue falling short.
Meta, however, delivered better-than-expected results, boosting its stock. Apple also reported positive earnings, despite a decline in iPhone sales.
Stock Information:
Amazon (AMZN): Closed at $184.07 (-1.56%); After hours: $171.40 (-6.88%)
Despite exceeding earnings per share (EPS) estimates with $1.26 against the anticipated $1.04, and doubling profits from the same period last year, the focus remained on the sales guidance miss.
Amazon reported $148 billion in revenue, slightly below the $148.8 billion expected, with its advertising segment also missing expectations at $12.8 billion versus the $13 billion forecasted.
However, Amazon Web Services (AWS) performed well, generating $26.3 billion in revenue, surpassing the $26 billion estimate and the $22.1 billion from the previous year.
Amazon CFO Brian Olsavsky highlighted the company's significant investment in AI and cloud services infrastructure, with over $30 billion spent on capital expenditures in the first half of the year.
Increased competition from companies like Temu and Shein in the ecommerce space has led Amazon to develop its own discount digital storefront to capture fashion and lifestyle spending.
Other Big Tech companies have also faced scrutiny, with Microsoft's cloud revenue missing expectations and Alphabet's YouTube ad revenue falling short.
Meta, however, delivered better-than-expected results, boosting its stock. Apple also reported positive earnings, despite a decline in iPhone sales.
Stock Information:
Amazon (AMZN): Closed at $184.07 (-1.56%); After hours: $171.40 (-6.88%)