ONLINE retailer Amazon shocked investors last night with a far weaker-than-expected outlook for the crucial holiday season quarter as it spent heavily on its new Kindle Fire tablet computer.
The stock tumbled 12 per cent in extended trading as the news raised concern that Amazon was losing some of the revenue momentum that had helped investors overlook its razor-thin profit margins.
Amazon said yesterday its third-quarter net income was $63m (£39.4m), versus $231m a year earlier. Revenue was $10.88m, up 44 per cent from the third quarter of 2010 but below analyst estimates.
The company also said it could report a $200m operating loss to a $250m operating profit in the coming holiday quarter as it spends on the Fire and other initiatives.
City A.M. Reporter