SEARCH LATEST NEWS
Amzn Home Privacy Archive
AMZN
POSTED BY EIZ ON THURSDAY, 19 JANUARY, 2012, 7:14 AM
GO
Amzn.png
Online retailer Amazon.com (AMZN) provided bleak outlook for the first quarter dragging its stock
down more than 8 percent in the extended hours of trading. Though the company's revenues for
the fourth quarter fell shy of estimations, earnings came in ...
Share |
AMZN
POSTED BY EIZ ON THURSDAY, 19 JANUARY, 2012, 7:14 AM
Online retailer Amazon.com (AMZN)
provided bleak outlook for the first quarter
dragging its stock down more than 8
percent in the extended hours of trading.
Though the company's revenues for the
fourth quarter fell shy of estimations,
earnings came in ahead of expectations
on improved operating margins
sequentially. Gross margin too showed
slender improvements sequentially.
Year-on-y e a r , t h e c o m p a n y ' s p r o f i t
plummeted 57.5 percent though revenues
surged 34.6 percent. Clearly, increased costs hurt its gross as well as operating profit.
The disappointment from the market is quite understandable since the stock is trading in the 52-
week range of $160.59 to $246.71. Amazon seemed to have preferred cautiousness while
providing outlook given the fact that even for the fourth quarter; it had projected in the same way of
operating loss to operating profit.
Of late, the company has been expanding its presence in new regions and categories resulting in
more spending amidst squeezing margins. The company had offered free shipping and
discounted prices for its Kindle devices hurting margins further.
The Seattle, Washington-based Amazon reported net income of $177 million, down 57.5 percent
from $416 million and earnings plummeted 58.2 percent to 38 cents a share from 91 cents a
share in the year-ago quarter.
Net sales increased 34.6 percent to $17.43 billion from $12.95 billion in the previous year quarter.
Street analysts' had estimated the company to deliver earnings of 19 cents a share on revenues of
$18.21 billion.
Gross margin slipped to 20.65 percent from 23.5 percent, while operating margin dropped to 1.49
percent from 3.71 percent in the year-ago quarter. But sequentially, gross margin showed slight
improvement from 20.31 percent and operating margin more than doubled from a mere 0.73
percent in the third quarter.
Moving ahead, Amazon expects operating loss of $200 million in the negative range to operating