Amazon Stock Drops on Holiday Sales Miss
The e-commerce giant reported fourth-quarter revenue of $43.7 billion, off from Wall Street's forecasts.
Amazon grew revenue by 22 percent during the shopping-heavy holiday season, the company announced Thursday, but analysts hoping it would sell even more during the quarter sent the stock down 4 percent during afterhours trading.
The e-commerce giant, which typically sees a bump in sales over the holidays, grew fourth-quarter revenue to $43.7 billion, but Wall Street was expecting revenue of nearly $44.7 billion.
Amazon, a company that was once known for sustaining consecutive quarters of losses, reported fourth-quarter net income of $1.54 per share, its seventh strait quarter of profitability. Wall Street was looking for $1.35 per share.
It was during the fourth quarter that Amazon expanded the availability of its Prime Video subscription offering to more than 200 countries around the world. But while CEO Jeff Bezos on Thursday made Prime and Prime Video a focus of his comments about the period, he did not provide an update about the size of Amazon's subscriber base, which the company has been coy about since the annual membership launched in 2005.
"Our Prime team's customer obsession kept them busy in 2016," the exec said in a statement. "Prime members can now choose from over 50 million items with free two-day shipping — up 73 percent since 2015. Prime Video is now available in more than 200 countries and territories. Prime Now added 18 new cities, which means millions more members now get one and two hour delivery. New benefits were also added to the list, like Prime Reading, Audible Channels for Prime, Twitch Prime and more. And customers noticed — tens of millions of new paid members joined the program in just this past year."
The fourth quarter is when Amazon's Santa Monica-based content division, Amazon Studios, released Manchester by the Sea. Last week, the drama nabbed the e-tailer its first Oscar nominations.
Amazon shares closed up about 1 percent to $840.18.
More to come.