Amazon.com Inc (NASDAQ:AMZN) stock fell in late trading after it reported mixed results for the fourth quarter, with higher-than-expected sales through the company’s e-commerce services and cloud-computing business, but weaker-than-anticipated profits.
The company after the closing bell posted sales of $149.2 billion, up 9% from $137.41 billion a year earlier, beating Wall Street expectations.
However, revenue at the company’s closely watched Amazon Web Services (AWS) unit was a little shy of expectations. During the quarter, AWS produced operating income of $5.21 billion on revenue of $21.38 billion. Analysts were expecting profit of $5.73 billion on sales of $21.85 billion, according to FactSet.
Amazon also said sales in the current quarter should reach between $121 billion to $126 billion, matching expectations. Analysts surveyed by FactSet have been forecasting sales of roughly $125.1 billion.
READ: Alphabet 4Q results hurt by lower YouTube ad spending, Google Cloud weakness
However, whichever way you dice it Amazon reported its least profitable holiday quarter since 2014. It posted a holiday profit of $278 million, or 3 cents a share, up from $1.39 a share a year ago.
For the year, Amazon also produced a net loss of $2.7 billion and revenue of $513.98 billion, up from $469.82 billion a year ago. This was the first time the company’s annual sales total streaked past a half-billion dollars.
As expected, Amazon logged an expensive loss on its stake in electric-truck maker Rivian Automotive. Separately, the company’s operating expenses in North America have outpaced sales during the first three quarters of 2022, though the company narrowed the gap in the fourth quarter.
“In the short term, we face an uncertain economy, but we remain quite optimistic about the long-term opportunities for Amazon,” Amazon CEO Andy Jassy said in a statement.
Investors reacted to Amazon’s worst annual loss on record, sending shares tumbling 4.8% to $107.50 in late trading.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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