SEATTLE Jan 30 Amazon.com Inc missed
Wall Street's profit estimates for the crucial holiday period
and cautioned investors about a possible operating loss this
quarter, pushing its shares down more than 4 percent on
The world's largest Internet retailer, which has spent
heavily to forge new markets in cloud computing and digital
media, expects operating results for the current quarter to
range from a $200 million loss to a $200 million profit,
compared with a $181 million profit a year ago.
Amazon has been trying to sustain its red-hot pace of growth
by investing heavily in its retail and distribution network
across the globe, while expanding into the technology realm with
Kindle digital devices, cloud computing services and online
That has taken a toll on its bottom line. With revenue
growth slowing as Amazon achieves unprecedented scale, analysts
said investors may be getting impatient.
"Amazon's gotten so many hall passes on earnings," said
Colin Gillis, an analyst at BGC Financial, adding that pressure
on the company to produce profit is now rising. "Perhaps the
market expectations for them to deliver income, as their revenue
growth slows" is increasing, said Gillis.
Executives on Thursday told analysts they were considering
an increase in prices for its "Prime" two-day shipping service
in the United States, which also includes free video streaming
on demand and a book-lending library.
But they had made no final decision on that.
PATIENCE A VIRTUE?
The company posted net income of $239 million, or 51 cents
per share, compared with $97 million, or 21 cents per share, in
the year-ago quarter. Analysts had expected 66 cents, on
Net sales grew 20 percent to $25.6 billion in the fourth
quarter, versus expectations for just above $26 billion and
slowing from the 24 percent of the previous three months.
North American net sales in particular grew 26 percent to
$15.3 billion, from 30 percent or more in the past two quarters.
International sales rose just 13 percent, below Wall Street
expectations for around 14 percent to 15 percent growth.
The company forecast revenue of $18.2 billion to $19.9
billion in the first quarter, a conservative outlook relative to
Wall Street's expectation for about $19.7 billion in sales.
Shares in Amazon were down almost 4 percent at $388, from a
close of $403.01 on the Nasdaq. The stock was down more than 10
percent at one point in extended trading.
Fourth-quarter income from operations rose to $510 million
from $405 million in the same quarter of 2012.