Amazon misses with Q3 revenue of $110.8B, up 15% YoY, vs $111.6B est., net income of $3.2B, down from $6.3B YoY, AWS net sales of $16.1B, up 39%; stock down 4%+
SEATTLE—(BUSINESS WIRE)— Amazon.com, Inc. (NASDAQ: AMZN) today announced financial results for its third quarter ended September 30, 2021.
The following year's Q3 coverage shows the split persisted: consolidated revenue again grew 15%, while AWS growth slowed to 27% and net income declined. That makes this quarter an early marker of a more demanding growth-and-profit comparison period for Amazon.
First-order effects
Amazon missed the reported revenue estimate, and its shares fell more than 4% as net income dropped to $3.2 billion from $6.3 billion a year earlier.
AWS generated $16.1 billion in net sales, up 39%, making it Amazon's fastest-growing reported business in the quarter.
Second-order effects
Amazon's investor narrative shifts toward whether AWS growth can counterbalance slower consolidated sales growth and the year-over-year profit decline.
The contrast with Q3 2020's 37% companywide sales growth raises the performance bar for Amazon's retail operations, while AWS becomes a larger focus in quarterly valuation reactions.
Third-order effects
If the divergence persists, Amazon's earnings profile becomes more dependent on cloud growth than on broad companywide sales expansion.
The later Q3 2022 results—15% overall revenue growth and 27% AWS growth—suggest the issue is not a one-quarter reset but a longer normalization in growth rates.
The trend: Amazon is moving into a slower-growth phase in which AWS's relative expansion increasingly anchors the company's financial narrative.
AWS growth 39% compared to ~15% across Amazon, while maintaining reported margin of ~30%. Amazon growth ex AWS is ~12%, margin slightly negative. AWS op income $4.883B other Amazon $-31M. So yeah, AWS is generating just over 100% of Amazon profits. https://twitter.com/...
> Operating income decreased to $4.9 billion in the third quarter, compared with $6.2 billion 2020Q3 > Net income decreased to $3.2 billion in the third quarter, or $6.12 per diluted share, compared with $6.3 billion, or $12.37 per diluted share, 2020Q3 https://twitter.com/...
In non-meta news, the nation's largest online retailer warned it could break even in the current quarter amid steep costs tied to labor and supply chain issues https://www.cnbc.com/...
I wouldn't call this a “Bad Miss” on revenue. #Earnings were a bit weak. Investments in growth including facilities, raising wages, and higher cost of goods likely culprits in capex intensive business. $AMZN https://www.cnbc.com/...
Wow, $AMZN says it's possible that in Q4 it could have up to $140 billion in sales, but thanks to surging costs, it could have $0 profit. https://www.bloomberg.com/...
on a percentage basis, AWS contributed more than 100% of Amazon's overall operating income. it happened on the regular in 2014-2017 this hadn't happened since Q1 2020 https://www.cnbc.com/...
Outstanding growth for @awscloud is one very bright spot amidst the @amazon earnings miss. Amazon Web Services: 🔺️39% AWS earnings Q3 2021 https://cnbc.com/...... $AMZN #cloud
what a screwed up world where Amazon makes $111 billion in a quarter (!!!) rather than $112 billion, and it's “disappointing” and sad for the investor class https://twitter.com/...
In addition to: ecommerce, streaming, cloud, advertising, grocery and logistics.... Amazon also becoming a bigger player in gaming: “New World... became highest-played new game this year on Steam...On Twitch...most-watched game during its launch week by hours watched”
$AMZN talking about how labor costs, and other constraints are really going to take a bite. Some great stuff form @spencersoper on the TLIV blog.. The stock is declining after hours. https://www.bloomberg.com/... https://twitter.com/...
Really hard to know how much of Amazon's serious growth slowdown is comparisons to a bonkers 2020 vs. supply constraints vs. labor shortages vs people shopping more in stores vs. ???? But yeah: https://www.bloomberg.com/...