Amazon shares soar after massive earnings beat – CNBC

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Amazon‘s third quarter results far exceeded Wall Street expectations Thursday as revenue growth offset increased spending in new areas.

The company’s earnings beat analysts’ forecasts by nearly 50 cents, while offering a positive outlook for the fourth quarter, typically Amazon’s largest quarter.

Amazon’s shares jumped over 7 percent in after hours trading.

Here are the most important numbers:

  • Revenue: $43.7 billion vs. $42.14 billion, according to Thomson Reuters
  • EPS: 52 cents vs. 3 cents per share, according to Thomson Reuters
  • AWS revenue: $4.58 billion vs. $4.51 billion, according to Thomson Reuters

Revenue increased 34 percent from last year, in part due to the $1.3 billion in sales from Whole Foods, which Amazon acquired in late-August. Analysts were expecting 27 percent growth in revenue.

Meanwhile, investors continue to give a pass to Amazon’s laser-thin profits. Its operating profit dropped 40 percent to $347 million, as the company invested in new areas. That’s an operating margin of just 0.8%, the lowest since September 2014.

AWS remains the the company’s growth driver, jumping another 42 percent in sales.

Amazon also broke out physical store sales for the first time, following its Whole Foods acquisition. Revenue from physical stores was $1.3 billion, meaning most of its came from the grocery chain.

Amazon said it added 160,000 employees in the last three months (roughly 87,000 from Whole Foods), ahead of the all-important holiday seasons, making it the second largest employer in the US after Walmart.

Amazon gave fourth quarter guidance in the range of $56.0 billion and $60.5 billion, right in-line street estimate of $58.9 billion. Investors keep a close eye on Amazon’s fourth quarter revenue guidance as it’s typically its biggest quarter of the year.

This is breaking news. Please check back for updates.



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