Shares of e-commerce giant Amazon.com, Inc. (NASDAQ: AMZN) are selling off sharply this afternoon after disappointing Wall Street with its second quarter numbers.This afternoon's results shows the company posting a 10% drop in quarterly net profit, as the company was hit by an unfavorable foreign currency translation and legal expenses related to its recent $51 million Toys R Us settlement.
As we saw in our earnings preview for today's earnings report, analysts had been expecting to see the company show earnings of 32 cents per share. The company was able to match this estimate by posting 32 cents per share, but Amazon's net sales came up a little short in the quarter at $4.65 billion. Analysts had been looking to see net sales of $4.7 billion.
Gross margins increased in the quarter to 24.4% from 23.8%.
Looking at the current quarter, Amazon forecast that revenue to be 11 to 23% higher than the same period last year. As for operating income estimates, the company issued a very broad forecast of somewhere between a 22% drop to a 36% increase.
The company is now estimating that third quarter sales will be somewhere in the range of $4.75 billion to $5.25 billion. Analyst are forecasting sales for the quarter at $4.92 billion.
The stock had a good day in today's market, as investors reacted to the news last night that Amazon was acquiring online shoe retailer Zappos.com. It closed Thursday's trading up 5.7%, but after hours reaction to this afternoon's earnings has sent shares lower by 8.0%.
Entrepreneur's Journal: Want to get a piece of the Buffett/Goldman honeypot?
The week in preview: No turkey earnings from Tyson, Hormel, Cracker Barrel ...
Comfort Zone Investing: Intel is saying something ... can you hear it?
Reader Comments (Page 1 of 1)
7-23-2009 @ 6:52PM
cpamba711 said...
This is the worst customer service company on the net. Their sales will ventually fall to zero when people realize that they are getting ripped off by the merchants and Amazon is just collecting their commission and not standing behind the customer. Or perhaps if they do dtand behind you watch your ass ! Want details email me for my horrible experience.
7-23-2009 @ 9:15PM
KthStefani said...
I sell on Amazon and I offer first class customer service. I can not say the same thing about Amazon itself. Sellers do not make the fortune that most people seem to think they do. After Amazon gets their outrageous cut, my expenses, taxes, time, gas etc. there is not a lot of the pie left.
I don't know what experience the previous poster had, you should try being a seller and try dealing with the daily headaches from Amazon and the customers.