Amazon's quarterly profit has dropped year-over-year for the first time since 2017. The net profit was because of high costs according to company data compared to the previous year's value by nearly 28 per cent lower with 2.1 billion dollar. The result was well below the expectations of Wall Street, the stock fell at times after trading by more than nine percent. In contrast, sales increased 24 percent to $ 70 billion.
The third quarter is traditionally costly, with Christmas shopping and the shopping spree around Thanksgiving being prepared with the Black Friday and Cyber Monday discount battles. Amazon is also investing massively in its shipping logistics to meet the promise of deliveries within 24 hours for "Prime" customers. In the last quarter of the year alone, the group wants to spend about 1.5 billion dollars for this effort, announced CFO Brian Olsavsky.
Outlook for Christmas business disappointed analysts
The boss of the world's largest online retailer, Jeff Bezos, was once known to push strong growth with high spending - but in recent years, the group has become a reliable winning machine. Now Amazon is already waiting for the second quarter in a row with high costs and far less surplus than expected. Previously, there had been four quarters of record earnings in a row.
Also, the outlook on the Christmas business disappointed. For the final quarter, Amazon sales of between 80 billion and 86.5 billion dollars in prospect. Analysts had expected significantly more. In addition to the established rivals such as Alibaba or Ebay, Amazon is getting more and more competitive - for example, by the US shopping giant Walmart, which is vigorously expanding its online business.