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Amazon’s Q3 Revenue Surges, But Profit Badly Misses View

Thursday, October 27, 2016 13:57
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(Before It's News)

amazon-a-logoTechnology and retail giant Amazon.com, Inc. (NASDAQ:AMZN) late today posted mixed third quarter earnings results, as profits fell well short of Wall Street expectations.

The Seattle-based company reported Q3 EPS of $0.52, a whopping $0.30 worse than analysts’ view of $0.82 per share. Revenue jumped 29% from last year to $32.71 billion, topping Wall Street’s $32.65 estimate, however.

Amazon said North American net sales on its namesake website rose 26% from the year-ago period to $18.9 billion, while International sales gained 28% to $10.6 billion. Amazon Web Services (AWS) net sales surged 54.5% to $3.2 billion in the latest period, as the company’s cloud platform continues to grow by leaps and bounds.

Looking ahead, AMZN forecast Q4 revenues ranging from $42.0 to $45.5 billion, which is mostly in line with Wall Street’s $44.65 billion estimate. Operating income is expected to be between $0 and $1.25 billion, which would be below estimates. Amazon booked operating income of $1.1 billion Q4 of 2015.

The company touted the early success of its Alexa voice command platform via press release:

Alexa may be Amazon’s most loved invention yet — literally — with over 250,000 marriage proposals from customers and counting,” said Jeff Bezos, founder and CEO of Amazon. “And she’s just getting better. Because Alexa’s brain is in the cloud, we can easily and continuously add to her capabilities and make her more useful — wait until you see some of the surprises the team is working on now.”

Amazon shares fell $29.28 (-3.58%) to $789.08 per share in after-hours trading following the report. Prior to today’s earnings release, AMZN had gained 21.3%.

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