Amazon’s stock price dropped 11% Friday as it warned of soft sales in the key holiday season.
The online retailer’s market cap is on course to fall below $1 trillion if those losses hold at the open.
The world’s biggest e-commerce company warned of an inflation-driven drop in spending and currency headwinds.
Amazon shares dropped nearly 11% at the opening bell Friday after a poorly received third-quarter earnings report.
The online retailer missed revenue targets and issued a gloomy sales forecast for the key holiday shopping season in its third-quarter earnings report late Thursday.
Amazon shares were down 10.65% at $99.26 at last check Friday, after cratering as much as 21% to $87.59 in after-hours trading.
Those losses wiped $120 billion off the company’s market cap, which sat at $1.01 trillion shortly after the opening bell.
Amazon posted third-quarter revenue of $127.10 billion, compared with analysts’ expectations for $127.46 billion projection, according to Refinitiv.
The world’s biggest e-commerce company said it expects a slowdown in sales growth in the last quarter of the year, warning about a fallback in spending by consumers and businesses worried about inflation.
Amazon forecast revenue of between $140 billion and $148 billion in that quarter, well below the Wall Street consensus for $155.15 billion in Refinitiv data. Its projected sales growth of 2% to 8% year-on-year is well below the 9% and 38% seen in the fourth quarters of 2021 and 2020.
The company’s finance chief Brian Olsavsky said sales were moderating across several of its businesses, speaking on a call with reporters. He cited increasing headwinds from foreign currency exchange, as the dollar’s strength dominates, and said those effects will persist into the fourth quarter.
Amazon is the latest Big Tech company to see its stock price plunge in a brutal third-quarter earnings season that has revealed pressure from falling digital ad sales, a consumer spending slowdown and the impact of the strong dollar. Google parent Alphabet and Facebook parent Meta Platforms both saw steep falls in stock price.
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