Despite record profits, Amazon shares sink on disappointing sales

Amazon sinks as revenue growth disappoints

Amazon sinks as revenue growth disappoints

The 9-percent fall in shares knocked more than $80 billion off Amazon's market value and relegated it behind Microsoft Corp.

The new driver of the stock, of course, is the very mixed third-quarter results on Thursday.

There were no ratings downgrades from the Wall Street analysts who have nearly universally backed the companies' long-term prospects, but several said there were signs that both were beginning to face tougher competition from tech peers as well as the retail companies Amazon has bullied in recent years. Even its highly profitable cloud-computing business, Amazon Web Services, didn't grow as fast as it had in the previous three months, Bloomberg reported. More distressingly, the company's outlook implied that its fourth-quarter profit could be far lower than Wall Street was predicting.

Google-parent Alphabet sank 3.3 percent after its revenue missed estimates, fanning concerns that investments in new businesses, rising regulatory scrutiny and competition are producing slow returns.

"Investor focus likely shifts to softer-than-anticipated holiday revenue [and] profitability guidance", he said in the note.

Investors focused on the negative. The selloff completely wiped out the stock's strong gains earlier in the day in the regular session. They have reduced their revenue forecast for the current quarter by 3% to $71.1 billion. Analysts were looking for $US57.1 billion. Amazon had guided for net sales of between $54 billion-$57.5 billion for the quarter.

Q3 earnings per share: $US5.75.

Q4 revenue (forecast): Between $66.5 billion and $US72.5 billion.

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A few minutes later, Gillum called DeSantis Trump's "stooge" who wanted to "worship at the feet of Donald Trump ". Gillum implied that DeSantis has aligned himself with racists through social media and speeches he's made.

The nerve-wracking anxiety that's gripped the US stock market seems oddly unmoored from economic reality: Despite the turbulence on Wall Street, economic growth is strong, unemployment ultra-low and consumers exceptionally confident. But its outlook implies a profit of between $3 a share and $5.54 a share, assuming its interest income, interest expense, tax rate, and share count remain about the same.

On the brighter side was data that showed gross domestic product increased at a 3.5 percent annualized rate in the third quarter as a tariff-related drop in soybean exports was partly offset by the strongest consumer spending in almost four years and a surge in inventory investment. AWS's revenue jumped 46% from the year-ago period to $US6.7 billion.

Olsavsky, the CFO, also said the company is operating more efficiently, hiring less than in the past and adding less warehousing space. After blazing a path beyond $2,000 earlier this year, imputing a valuation of the company of $1 trillion, the stock price has fallen back a bit as tech stocks overall continue to get pummeled this fall.

Those results were inflated by the company's acquisition of Whole Foods.

That's a 21 percent increase compared to the same time a year ago.

And the company continued to see success in advertising. In its "other" category, which is mostly made up of its growing advertising business, revenue more than doubled to $2.5 billion.

Amazon's stock closed regular trading up $US117.97 a share, or 7.1%, to $US1,782.17.

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