Shares fell in late trading Thursday after the e-commerce and cloud computing giant reported mixed results for the June quarter, with better-than-expected gains but sales that fell short of Wall Street estimates.
The miss reflects a shortfall in Amazon’s e-commerce business, which has suffered a sharp slowdown due to recent growth trends. The e-commerce slowdown was partially offset by better-than-expected results in the company’s cloud computing, advertising and third-party vendor segments.
For the quarter, Amazon (ticker:AMZN) posted revenue of $113.1 billion, up 27% from a year ago, or 24% when adjusted for currency, right in the middle of the company’s target range of $110 billion to $116 billion, and a little shy of the Wall Street consensus of $115.4 billion. Earnings were $15.12 per share, ahead of analysts’ forecast of $12.28 per share. Operating income was $7.7 billion, near the top of the projected $4.5 billion to $8 billion range, and just below the Wall Street consensus of $7.8 billion.
Online store sales were $53.2 billion, up 16% from a year ago, or 13% adjusted for currency, well below Street’s consensus forecast of $57.3 billion. That was less than the 41% growth in the March quarter and 49% growth a year ago.
Third-party services revenue was $25.1 billion, up 38%, or 34% when adjusted for currency, above the consensus forecast of $24.8 billion. But that was nonetheless a 60% slowdown in the March quarter and 53% a year ago.
Amazon Web Services, the company’s cloud arm, had revenue of $14.8 billion, up 37%, and well above Street’s estimate of $14.3 billion, accelerating from a 32% growth in March. and a growth of 29% a year ago.
“Other” revenue, primarily advertising, was $7.9 billion, up 87% or 83% on a currency adjusted basis, well above the $7 billion consensus, and consistent with recent strong ad data from
Alphabet and other ad-driven companies. Brick-and-mortar sales were $4.2 billion, an increase of 11%, surpassing the Street View price of $3.9 billion.
North American sales growth, excluding currency effects, slowed to 21% in the quarter, down from 39% in March and 44% a year ago. Operating margin in North America was 4.7%, down from 5.4% in March, although up from 3.9% a year ago. International sales were up 26%, down from 50% in the March quarter and 41% in the previous quarter.
For the September quarter, Amazon forecasts revenue of $106 billion to $112 billion, under the Street consensus of $118.6 billion, with operating income ranging from $2.5 billion to $6 billion, versus $6.2 billion a year ago. The company said the guidelines assume about $1 billion in costs related to Covid-19.
Amazon shares are down 6.7% in late trading. The share has increased by 11% in 2021, following the
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