The holidays were so brutal for retailers that even Amazon missed Wall Street’s forecasts.
The online retail giant — led by CEO Jeff Bezos — delivered stellar fourth-quarter results. But Amazon’s stock got smacked after the bell because investors had bet they would be even better.
Sales during the crucial holiday quarter soared an impressive 20 percent to $25.6 billion, as more shoppers snagged Christmas gifts online to avoid malls and nasty winter weather.
The Seattle-based company’s revenue gain showed that Amazon continued to chew up market share in what was a ho-hum Christmas for bricks and mortar merchants. Earlier this month, Best Buy revealed a holiday profit warning that sent its stock tumbling more than 25 percent.
Nevertheless, Amazon’s results fell short of the upper end of a forecast the company had given three months earlier, when it predicted a fourth-quarter revenue increase as high as 25 percent to $26.5 billion. Wall Street had projected $26.06 billion.
Amazon shares tumbled 4.9 percent, or $19.91, to $383.10. In the regular session, the stock closed above $400, at $403.01.
The world’s largest online retailer had goosed investor expectations in September, when it announced it was increasing its hiring of temporary warehouse workers by 40 percent, even as many traditional retail chains were cutting back on help.
In the thick of the holiday rush, UPS admitted its trucks were missing Christmas delivery deadlines, partly blaming overload from Amazon orders.
For the quarter, Amazon reported a $239 million profit that was equal to 51 cents a share — up a whopping 146 percent versus a year earlier, when it logged 21 cents a share.
The tidy profit was rare for the company, as Bezos historically has spent lavishly on growth initiatives, arguing that gaining market share is more important than near-term earnings.
Profits surged despite the hefty investments, but they still sorely missed the Street’s forecast of 66 cents a share.
Tech-industry analysts, appearing mostly clueless about Amazon’s plight during the holidays, had been all over the place with their profit predictions. Estimates for earnings per share had been as low as 1 cent and as high as $1.88, averaging at 71 cents a share.