Holiday spending proved somewhat soft in eCommerce giant Amazon’s latest quarter, with results on the top line lighter than expected, sending shares down 4 percent after-hours. Guidance was also below Street expectations.
The headline EPS number came in at $1.54 a share, outpacing the $1.35 that had been projected by analysts. But it was revenue of $43.7 billion, falling below The Street at $44.7 billion, that sent shares on a skid. Within that tally, Amazon Web Services’ revenue was $3.5 billion, while analysts had seen $3.6 billion (price cuts mentioned on the call may be a determinant here). Looking forward, the firm sees the current quarter at a range of $33.3 billion–$35.8 billion, as compared to the almost $36 billion analysts had been baking into their models.
Amazon focused a bit on Prime in its earnings release, noting that tens of millions of paid members had joined the loyalty program during 2016. The video service, said management, is in 200 countries, with the Prime Now delivery service having staked a claim in 18 cities. Without further commentary on Prime numbers, the company said that it saw hours spent on Prime streaming double on a year-over-year basis in the fourth quarter.
Nor were there numbers provided that were specific to the fulfillment operations, though the firm said that paid unit growth was 24 percent year over year. CFO Brian Olsavsky told analysts on the conference call that square footage tied to those fulfillment operations had grown by 20 percent annually over past years, and investment across that business will be continued this year, too. Additional investments will continue along digital channels. As for Echo, sales of those devices were up nine-fold during the holiday season, said the CFO. Amazon Bookstores will add five units in 2017, on top of the three already in the field.