Amazon fails to impress investors with its balance sheets.
(Photo: dpa)
The world’s largest online retailer Amazon has surprised investors with a weak sales forecast for the Christmas quarter. The group expects revenues of between 140 billion and 148 billion dollars, as announced on Thursday.
Analysts had expected significantly more. The share price fell by more than 20 percent in after-hours trading. The profit forecast – Amazon promises a result of between zero and 4.0 billion dollars – also caused disappointment.
In the past third quarter, Amazon earned $2.9 billion. In the corresponding period last year, it was still 3.2 billion dollars. Sales grew 15 percent to $127.1 billion, but also fell short of market expectations.
In the USA, Amazon also lost money in traditional mail order business in the third quarter this time: the bottom line was an operating loss of 412 million dollars, where a year ago a profit of 880 million dollars was recorded. In international business, the loss has almost tripled to around $2.5 billion.
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The fact that the group result is still positive is once again due to AWS’s cloud business. But there, too, the analysts had expected more in terms of sales.
Only the advertising business is really positive at the moment. Amazon was able to increase sales by a quarter to $9.55 billion. That was more than analysts had expected.
Inflation and the weak economy are hurting the mail order business
But it is above all the cautious outlook that worries investors. The fact that the new Prime Day at the beginning of October, according to CEO Andy Jassy, only went “quite well”, does not sound like enthusiasm.
But there are also positive voices. While investors sent the share plummeting, Julian Skelly from the consulting firm Publicis Sapient can see something positive in the results: “Although Amazon has had a difficult year in 2022, the results of the third quarter show the strength of a diversified company,” comments Skelly.
It is true that inflation and the weak economy have damaged the mail order business. “However, this was offset by the extraordinary growth of the high-margin AWS business,” emphasizes the consultant.
More: Microsoft numbers: Strong cloud sales meet weak forecast