Amazon’s Shares Dip in After-Hours Trading Despite Strong Q2 Earnings – Full Analysis
In a surprising turn of events, Amazon’s shares took a hit in Thursday’s after-hours session, dropping by 1.7%. This comes as the e-commerce giant reported second-quarter profits that exceeded expectations, but fell short on revenue and offered a cautious full-year outlook.
The company’s net income soared to $13.49 billion, or $1.26 per share, up from $6.75 billion, or 65 cents per share, in the same period last year. This impressive performance beat the FactSet consensus for earnings per share of $1.03, marking the sixth consecutive EPS beat.
Despite this positive news, sales only grew by 10.1% to $147.98 billion, missing the FactSet consensus of $148.67 billion. This was the first revenue miss in seven quarters, highlighting potential challenges for Amazon in the near future.
Breaking down the sales figures, product sales rose by 4.3% to $59.03 billion, while service sales saw a more substantial increase of 14.7% to $86.41 billion. Looking ahead to the third quarter, Amazon expects sales to range between $154.0 billion and $158.5 billion, slightly below the current FactSet consensus of $158.22 billion.
Despite the strong earnings report, the stock closed the regular session down by 1.6%, indicating investor concerns about the company’s future performance.
In conclusion, while Amazon’s second-quarter results were impressive in terms of profits, the revenue miss and cautious outlook have raised some red flags for investors. It will be interesting to see how the company navigates these challenges in the coming months and whether it can sustain its growth trajectory.