By Yasin Ebrahim
Investing.com - Amazon.com (NASDAQ:AMZN) reported on Thursday third quarter earnings that beat analysts' forecasts as the pandemic-led surge in e-commerce sales boosted performance.
Shares fell 1.2%. Operating income is expected at between $1 billion and $4.5 billion for the fourth quarter, including $4 billion in expenses related to Covid-19. That compares to $3.9 billion in the fourth quarter of 2019.
Amazon.com announced earnings per share of $12.37 on revenue of $96.15B. Analysts polled by Investing.com anticipated EPS of $7.37 on revenue of $92.6B.
Amazon.com shares are up 73% from the beginning of the year, still down 9.59% from its 52 week high of $3,552.25 set on September 2. They are outperforming the S&P 500 which is up 2.43% from the start of the year.
Net sales in North America rose to $59.4 billion, up from $42.6 billion, and beating a forecast for $57 billion.
Amazon Web Services, its fast-growing cloud revenue segment, grew to $11.6 billion from $9 billion.
Ahead of the key holiday season, the company said it had seen customers shopping earlier than usual for their gifts.
"We’re seeing more customers than ever shopping early for their holiday gifts, which is just one of the signs that this is going to be an unprecedented holiday season. Big thank you to our employees and selling partners around the world who’ve been busy getting ready to deliver for customers this holiday," Amazon said.
Looking ahead, net sales are expected to be between $112 billion and $121 billion, or to grow between 28% and 38% compared with fourth quarter 2019, the company said. Operating income is expected to be between $1.0 billion and $4.5 billion, compared with $3.9 billion in fourth quarter 2019.
Amazon said its operating income guidance included a forecast for $4 billion of costs related to COVID-19.
"Amazon remains one of the top beneficiaries of pandemic-driven demand for e-commerce. The company’s sales are surging as people buying both essentials and discretionary products online. Amazon’s massive scale and its investments in infrastructure and technology will keep its growth momentum strong, mainly fueled by e-commerce, cloud and digital ads," Investing.com's Haris Anwar said.