Amazon sees lower operating profit this quarter, shares dip – channel newsasia
REUTERS: Amazon.com Inc forecast an unexpected dip in operating profit for the current quarter, sending shares down more than 4 percent due to concerns about the costs of investments including new warehouses and video content.
The world’s largest online retailer also reported lower-than-expected fourth-quarter revenue and missed Wall Street targets for its closely watched cloud computing unit.
The Seattle-based company is spending heavily to take greater control of package delivery and to expand its video service around the world. Python binary Key to its plan is to entice sign-ups for Amazon Prime, its US$99-per-year shopping club, which has led to users buying more goods, more often.
“The story is an investment story,” said Amazon Chief Financial Officer Brian Olsavsky on a conference call with reporters, noting “stepped-up” spending levels have continued into 2017.
For years, Amazon has posted roller-coaster results as founder and Chief Executive Jeff Bezos emphasizes building up businesses rather than making an immediate profit. World markets futures He has sunk profits into new areas that have either built new markets – as with cloud services or its Kindle e-readers – or have floundered, like its Fire Phones.
Sales in the first quarter will have a tough comparison to the year prior, Amazon’s Olsavsky said, when foreign exchange rates were more favorable and the Feb. Ringgit to usd converter 29 leap day gave shoppers an extra 24 hours to spend.
The just-ended holiday season was Amazon’s best-ever. 1 usd to thb It was a heavily promotional period for Amazon, said Olsavsky, though he did not comment on how discounts compared with prior years.
Net sales for Amazon rose 22.4 percent to US$43.74 billion in the fourth quarter, compared with the average analyst estimate of US$44.68 billion, according to Thomson Reuters I/B/E/S.
Amazon is now producing television shows for Prime subscribers to watch online. 1 usd in euro It is developing gadgets with an artificially intelligent assistant, Alexa, so users can buy toilet paper and other goods by voice command. Convert rmb to usd And it is building out a system of trucks, planes and warehouses so orders are sped to Prime members in two days or less, a convenience that few online retailers can afford to match.
“After these periods of intense investment or spending, then we see acceleration in sales and profitability, or at least historically we have,” said Edward Jones analyst Josh Olson.
The company forecast first-quarter operating income between US$250 million and US$900 million, below the consensus estimate of US$1.34 billion, according to market research firm FactSet StreetAccount.
Amazon Web Services, the company’s fast-growing and lucrative cloud business, posted a 47 percent jump in revenue to US$3.54 billion, but fell short of the average analyst estimate of US$3.60 billion, according to FactSet StreetAccount. Nis to usd Amazon is the market leader in the space, selling computer services, hosting websites and storing data.
The company said it would delay its annual financial filing so it can revise its disclosure of net product and service sales, following a letter it received from the U.S. Exchange rate euro usd Securities and Exchange Commission. Dow futures market This does not impact its financial results, it said.