Amazon’s holiday results topped even Wall Street’s heady expectations but the Seattle company warned that it might not do the same in the first quarter.
The company beat analysts’ earnings and revenue forecasts. Wall Street was estimating that the tech giant’s sales increased nearly 20% and its earnings per share (EPS) jumped nearly 50% in the fourth quarter.
But the e-commerce giant said that its first-quarter sales will fall shy of analysts’ forecasts.
Investors seemed to take the report in stride. In recent after-hours trading following the report, the company’s shares were off $3.97, or less than 1%, to $1,715.00
Here’s what Amazon reported and how it compared with Wall Street’s expectations and the company’s year-earlier results:
- Fourth-quarter (Q4) revenue: $72.4 billion. Analysts had forecast $71.92 billion. In the same period of 2017, Amazon posted sales of $60.45 billion.
- Q4 EPS: $6.05. Wall Street had predicted $5.55. In the fourth quarter a year earlier, the company earned $3.75 a share.
- First-quarter (Q1) revenue (company guidance): $56 billion to $60 billion. Analysts had forecast $60.99 billion. In the first quarter last year, Amazon saw sales of $51.04 billion.
- Q1 EPS (guidance): Amazon didn’t offer specific EPS guidance, but it predicted it would post operating income of between $2.3 billion and $3.3 billion. Wall Street had forecast $2.99 billion in operating income for the quarter and $4.43 a share in profit before the report. In the same period of 2018, the company posted $1.9 billion in operating income and earned $3.27 a share.
Amazon’s results were boosted yet again by its cloud-computing business. Sales at Amazon Web Services jumped 45% from the year-ago period to $7.4 billion. The unit posted $2.2 billion in operating income, which was more than two-thirds of the entire company’s total profit and was up nearly 61% from the fourth quarter of 2017.
The company also saw continued strong growth from its advertising business. Amazon’s “other” revenue, which mostly consists of ad sales, hit $3.4 billion in the quarter, up 95% from the same period a year earlier. Growth in the business did slow, though, from the torrid pace the company was on in the prior three quarters, when sales grew by at least 123% year-over-year in each period.
Amazon’s shares closed regular trading Thursday up $48.30, or 2.9%, to $1,718.73