Amazon Stock Drops on Weaker Holiday Guidance

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Amazon founder and CEO Jeff Bezos

The e-commerce giant has been investing in one-day delivery.

Amazon's stock was trading down as much as 8 percent after-hours on Thursday following the news that the e-commerce giant's profits dropped during its third quarter. 

The company brought in revenue of $70 billion during the period, up 24 percent year-over-year, but saw its profits decrease to $2.1 billion, or $4.23 per share. Amazon has been investing heavily in one-day delivery, which could have dragged profits during the quarter. 

The company also disclosed that it expects a soft holiday quarter, forecasting sales between $80 billion and $86.5 billion during the period — less than the $87 billion that some analysts were expecting. 

Amazon CEO Jeff Bezos released a statement touting the investment in one-day delivery. "Customers love the transition of Prime from two days to one day — they’ve already ordered billions of items with free one-day delivery this year," said the exec. "It's a big investment, and it's the right long-term decision for customers. And although it’s counterintuitive, the fastest delivery speeds generate the least carbon emissions because these products ship from fulfillment centers very close to the customer — it simply becomes impractical to use air or long ground routes. Huge thanks to all the teams helping deliver for customers this holiday."

During the period, Amazon released an expanded lineup of Fire TV products and debuted a number of new shows, including The Boys and Carnival Row. Amazon Studios programming also had a strong night at this year's Emmys, with Fleabag taking home four awards and The Marvelous Mrs. Maisel winning two. 

Amazon shares closed the day up 1 percent to $1,780.78. Shares were trading down more than $130 on the earnings news.