Business

Amazon reports a less profitable quarter than expected by the market

Although Amazon's cloud empire has reported significative growth, the company failed Wall Street expectations in its overall profits

Jeff Bezo‘s big tech Amazon has just reported the results for its third quarter of 2019, this afternoon, October 23rd. Among investors’ concerns regarding the report’s release, the main concern was to watch what kind of updates the company would announce about the aggressive spent used to move its shipping to next-day delivery, announced in April. Information is from Business Insider.

Earlier this year, Amazon said it planned to cut by half the new standard for Amazon Prime shipping – turning it into one day. Amazon Prime is the membership plan that grants access to free shipping and other services such as the company streaming platform, Prime Video.

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Although the tech and e-commerce giant has exceeded expectations in revenue – reaching $70 billion, up 24% from 2018’s same quarter and against $68.8 billion estimated by the market – the company missed expectations concerning profits – and announced earnings per share of $4.23, vs. $4.62 per share that Wall Street was expecting. With the results, Amazon shares registered a drop of more than 6% in after-hours trading, reaching around $116 per share promptly after the earnings release.

But not everything was losses, and what came as good news for Amazon’s investors was its cloud business empire, AWS, quarterly results. Amazon Web Services reported a revenue 35% higher this quarter, in comparison with the same period last year, reaching nearly $9 billion. One of Amazon’s most profitable business, AWS is constantly competing against Microsoft’s Azure and Google Cloud but remains as the global major cloud-computing company.