than an e-commerce one
Amazon reported its earnings after the bell today, and the results may not have met LSEG's expectations. Earnings per share came in at 94 cents per share, lower than the 58 cents expected. Revenue was reported at $143.1 billion, missing the $141.4 billion expected by LSEG.
Investors will also be looking closely at Amazon's individual business units, such as Amazon Web Services and Advertising, which are projected to bring in $23.2 and $11.6 billion in revenue, according to StreetAccount.
Although Amazon's growth slowed considerably in 2021 due to economic uncertainties, expansion has begun to tick up again, although it is still weaker than usual. Consumers have started spend more on discretionary items, which is expected to improve the retail business in Amazon. Analysts anticipate revenue growth of 11% in the third quarter, which is faster than the past couple quarters.
The fourth quarter is an important one for Amazon, as it includes the critical holiday period. The company also experienced success with its Prime Day sequel in October, which exceeded last year's event in terms of sales. Earnings per share of 66 cents with revenue of $166.6 billion is what analysts surveyed by LSEG are expecting for the December quarter.
Amazon's cloud computing business will also garner attention from investors. Many businesses have started to cut back on their spending in the cloud, thus slowing down growth in AWS. However, the emergence of generative artificial intelligence has jumpstarted workloads in the cloud, which can potentially benefit AWS and its competitors.
The stock market values Amazon as a cloud and generative AI company more than an e-commerce one. The company's 42% stock gains this year have exceeded the Nasdaq's 23% return. After Amazon had overexpanded during the pandemic, CEO Andy Jassy detailed a plan to cut 9,000 jobs this year in addition to the 18,000 layoffs already announced.
Overall, investors will be keeping a close eye on Amazon as it heads into the holiday season.
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