Amazon posted sales in the last quarter of last year, with Wall Street estimates on Thursday. The holiday shopping season has boosted strong retail, but investors have taken stock due to the weakness of cloud computing units.
Amazon's stocks dropped 3.5% in extended trade after reporting, eliminating stock market value worth around $90 billion.
According to data compiled by LSEG, its cloud unit Amazon Web Services (AWS), reported a 19% increase in revenue, short of its $28.87 billion estimate. Amazon joins smaller cloud providers Microsoft and Google to report weak cloud counts.
Cloud weakness comes when investors are increasingly impatient with Big Tech's multi-billion dollar capital spending and are hungry for profit from heavy investments in AI.
Both competitors Microsoft and Google Parent Alphabet saw slower cloud growth and lower stocks in the fourth quarter of last year. The costs for companies to develop the infrastructure for artificial intelligence software, along with the meta platform, are behind the large expected capital expenditures in 2025, behind a total of around $230 billion between them I said.
Still, Amazon's retailing helped offset the weakness in the cloud, with the company reporting quarterly 7% online sales growth to $75.56 billion. This compared to an estimated $745.5 billion.
The company reported revenue of $187.8 billion in the fourth quarter to $187.8 billion, according to data compiled by LSEG.
Advertising sales, a closely monitored metric, rose 18% to $17.3 billion. This is compared to the average estimate of $17.4 billion.
Net income almost doubled from $10.6 billion the previous year. Seattle retailers reported earnings of $1.86 per share, compared to their forecast of $1.49 per share.
