E-commerce giant Amazon missed consensus sales estimates as it reported its third quarterly earnings tonight, taking its share price down more than six per cent in after-hours trading.
Net sales for the quarter rose 29 per cent year-on-year from $43.7bn to $56.6bn (£49.8bn), narrowly missing estimates of $57bn as collated by S&P Global Market Intelligence .
Amazon also forecasted lower-than-expected net sales for the current quarter, predicting sales of between $66.5bn and $72.5bn compared with estimates of $73.8bn.
On a more positive note, its net income, or profit before tax, rose to $2.9bn, compared to taking in just $256m in the third quarter last year. This was a comfortable leap past Wall Street estimates of $1.9bn, and a rise of 91 per cent year-on-year.
Revenue at its fast-growing cloud computing business Amazon Web Services, which currently holds the top spot in terms of global market share, surged almost 46 per cent to $6.68bn, edging past estimates of $6.67bn according to Refinitiv data.
The quarter saw Amazon invest heavily in its Prime delivery service and original video content, as operating costs rose 21.8 per cent. In the UK, the firm last week committed to creating over 1,000 new highly-skilled jobs in 2019.
Capital.com chief market strategist David Jones told City A.M. that while the initial share price fall on Amazon’s results seemed harsh, “the reaction is much more to do with broader market volatility over the last few weeks than anything else”.
Earlier this month, tech stocks lost $172bn in a single day in a Wall Street slide, which was caused primarily by rising interest rates in the US.