Andy Jassy, CEO of Amazon and then CEO of web services at Amazon.com Inc., speaks during the Amazon Web Services (AWS) Summit in San Francisco, California, U.S., on Wednesday, April 19, 2017.
David Paul Morris | Bloomberg | Getty Images
Shares of Amazon plunged as much as 19% in extended trading on Thursday after the company posted weaker-than-expected earnings and revenue for the third quarter and gave a disappointing fourth-quarter sales forecast.
- Earnings: 28 cents per share
- Revenue: $127.10 billion vs. $127.46 billion, according to Refinitiv estimates
Here’s how the other key Amazon segments did during the quarter:
- Amazon Web Services: $20.5 billion vs. $21.1 billion expected, according to StreetAccount
- Advertising: $9.55 billion vs. $9.48 billion expected, according to StreetAccount
Amazon said it expects to post fourth-quarter revenue between $140 billion and $148 billion, representing year over year growth of 2% to 8%. Analysts were expecting sales to come in at $155.15 billion, according to Refinitiv.
Revenue grew 15% in the third quarter, marking a return to double-digit sales expansion, but it still fell short of Wall Street’s projected $127.46 billion.
Like the rest of Big Tech, Amazon has had a rocky year so far as it confronts macroeconomic headwinds, soaring inflation and rising interest rates. Those challenges have coincided with a slowdown in Amazon’s core retail business, as consumers returned to shopping in stores.
Under CEO Andy Jassy, who took the helm from founder Jeff Bezos in July 2021, Amazon has responded to rising expenses by aggressively cutting costs across numerous divisions in recent months. It shed warehouse space, halted some experimental projects, shuttered its telehealth service and froze hiring for corporate roles in its retail business.
“There is obviously a lot happening in the macroeconomic environment,” CEO Andy Jassy said in the press release. “And we’ll balance our investments to be more streamlined without compromising our key long-term, strategic bets.”
Amazon is rounding out a disappointing earnings week for Big Tech. Alphabet and Facebook parent Meta both posted earnings that fell short of expectations as they navigate challenges in the digital ad market. Microsoft wasn’t immune, reporting softer-than-expected cloud revenue and weak quarterly guidance.
Operating income fell by almost half from a year earlier to $2.53 billion from $4.85 billion. AWS accounted for all of the company’s profit, plus some, as the cloud unit generated operating income of $5.4 billion. Still, AWS missed analyst estimates for revenue.
This story is developing. Check back for updates.
