Shares Drop 20% as Q3 Sales Reach $127.1bn, Below Analyst Expectations
- Amazon shares fall by 20% due to sales slowdown prediction
- Sales hit $127.1bn in Q3 2022, a 15% increase from the prior year
- Operating income down to $2.5bn from $4.9bn in Q3 2021
- Expected sales between $140bn and $148bn for upcoming quarter (2-8% growth)
- Analysts expected $155.15bn, Amazon cites uncertainties as reasons for prediction
- CEO Andy Jassy focuses on cost reduction and customer experience
Amazon’s shares have fallen by up to 20% following the company’s warning of a potential sales slowdown in the upcoming quarter. The e-commerce giant reported sales of $127.1 billion (£110 billion) for the quarter ended on September 30, 2022, marking a 15% increase from the previous year. However, this figure fell short of analysts’ expectations. Operating income dropped to $2.5 billion (£2.2 billion), down from $4.9 billion (£4.3 billion) in Q3 2021. Amazon anticipates sales between $140 billion and $148 billion for the next quarter, representing a growth of 2-8% compared to Q4 2021. Despite this, analysts expected sales to reach $155.15 billion (£135 billion) during the crucial holiday shopping season. The company attributes the prediction to uncertainties such as pandemic impacts, foreign exchange fluctuations, economic and geopolitical conditions, inflation, interest rates, labour market issues, global supply chain constraints, and world events. CEO Andy Jassy remains focused on cost reduction and customer experience.
Factuality Level: 8
Factuality Justification: The article provides accurate information about Amazon’s financial performance, including sales figures, operating income, and the reasons behind the slowdown in sales. It also includes quotes from Amazon CEO Andy Jassy discussing the company’s strategy and outlook for the future. The article is not sensationalist or misleading, and does not include any personal opinions masquerading as facts.
Noise Level: 3
Noise Justification: The article provides relevant information about Amazon’s financial performance and CEO’s response to the situation, but it does not delve into deeper analysis or explore long-term trends or consequences of decisions on those who bear the risks. It also stays mostly on topic without diving into unrelated territories.
Financial Relevance: Yes
Financial Markets Impacted: Amazon’s stock price dropped by 20% due to lower-than-expected sales and operating income for the quarter ended September 30, 2022.
Financial Rating Justification: The article discusses Amazon’s financial performance and its impact on the company’s stock price, making it relevant to financial topics. It also mentions the potential impact on financial markets due to the drop in share value.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: Minor
Extreme Rating Justification: There is no extreme event mentioned in the text, and the financial performance of Amazon is not considered an extreme event as it is a common occurrence in the business world.
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