The stock of Amazon (AMZN) is down 8% after the e-commerce giant reported second-quarter sales figures that missed Wall Street targets and offered weak forward guidance.
Seattle-based Amazon announced earnings per share (EPS) of $1.26 U.S., which exceeded the consensus forecast of $1.03 U.S. that was forecast among analysts.
However, revenue of $147.98 billion U.S. fell short of the $148.56 billion U.S. that was expected on Wall Street.
Perhaps worse than the Q2 revenue miss was Amazon’s guidance, which calls for revenue in the current third quarter of $154 billion U.S. to $158.5 billion U.S., representing year-over-year growth of 8% to 11%.
The mid-point of that guidance range is $156.25 billion U.S., which is below the average analyst estimate of $158.24 billion U.S., according to data from FactSet.
Management blamed the revenue miss and weak guidance on world events such as the Olympics and attempted assassination of Donald Trump, which they said distracted consumers and made forecasting difficult.
For the second quarter, Amazon Web Services, the company’s cloud computing unit, posted revenue of $26.30 billion U.S., which was ahead of $26 billion U.S. estimated by analysts.
Amazon Web Services’ revenue rose 19% from a year earlier.
Advertising across the company’s various products and services totaled $12.80 billion U.S., which was slightly below the $13 billion U.S. expected. Despite the miss, ad revenue was up 20% from a year ago.
Amazon faces rising competition in its core e-commerce business from rivals such as Temu and Shein, which allow Chinese merchants to sell cheap items to American consumers.
Sales in Amazon’s online stores grew 5% from a year earlier. In June, Amazon said it plans to launch a discount store of its own that will feature unbranded items priced below $20 U.S.
Prior to today, the stock of Amazon had increased 44% over the last 12 months to trade at $184.07 U.S. per share.
Tech Insider
