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Home / Business / Amazon’s stock price fell as weak earnings expectations cast a shadow over the third quarter earnings blowout

Amazon’s stock price fell as weak earnings expectations cast a shadow over the third quarter earnings blowout



Amazon
  • Amazon fell 2% in premarket trading on Friday after the e-commerce giant said its fourth-quarter profit may be lower than Wall Street’s expectations.
  • Profit expectations exceeded Amazon’s third-quarter performance. Its sales growth soared by 37% and revenue exceeded expectations.
  • Amazon said that due to the rising costs associated with COVID-19, its fourth-quarter operating profit will range from $1
    billion to $4.5 billion, lower than Wall Street’s estimate of $5.81 billion.
  • Watch the Amazon deal live here.

Amazon fell 2% in premarket trading on Friday after the company’s fourth-quarter profit forecast disappointed investors and made its third-quarter results better than expected.

The e-commerce giant broke its third-quarter profit forecast, reporting earnings per share of $12.37, compared with previous expectations of $7.41. Amazon also reported a 37% increase in revenue and sales of USD 96.1 billion (expected USD 92.71 billion).

But Amazon said that its operating profit may decline in the fourth quarter because it is expected to spend approximately $4 billion on COVID-19-related costs.

Amazon said its operating profit in the fourth quarter will range from $1 billion to $4.5 billion, which is lower than Wall Street’s forecast of $5.81 billion.

Amazon also reported on Thursday that its Amazon Web Services third-quarter sales were $11.6 billion, in line with Wall Street expectations. Physical store sales fell 10% to 3.78 billion U.S. dollars, while Amazon advertising business sales were 5.4 billion U.S. dollars.

The third quarter is the first time that the number of Amazon employees has exceeded the 1 million mark. The e-commerce giant now has 1.13 million employees, a 50% increase from last year.

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