Amazon.com Inc (NASDAQ:AMZN) released its fourth quarter results yesterday as shares bounced 15% in after hours trading, despite earnings that analysts commented didn’t ‘look so hot.’
Operating income was down to US$3.5bn, almost half of the previous year’s total, along with slower revenue growth to 9%.
The company also lowered its guidance for the current quarter and is experiencing a big increase in staff costs.
Neil Wilson, chief market analyst at Markets.com also believes the headline numbers were “massively flattered by its Rivian investment”.
Russ Mould, investment director at AJ Bell added, “Rivian might have provided a sweetener to its results.”
Amazon increased its stake in the Tesla and Lucid rival to 18%, which would value the 160mln shares at roughly US$9.75bn, making it the largest shareholder in the electric vehicle manufacturer.
As a result, US$11.8bn of its US$14.3bn net income directly came from its investment in the electric vehicle manufacturer by a way of a pre-tax valuation gain on its non-operating income from Rivian.
Wilson labelled it a “one-off accounting trick.”