Amazon expected sales in the holiday quarter leading up to Christmas to rise between 10 per cent and 20 per cent, to as much as $72.5 billion, while analysts had expected a maximum figure of $73.9 billion, according to Refinitiv data.
"Overall, Amazon's growth trajectory remains solid, including advertising, grocery, pharmacy, and specialty retail, as well as Amazon Business ($10 billion in sales in eight countries) and Amazon Web Services", Telsey Advisory Group analysts said.
Revenue from Amazon's worldwide business, which brings in 27.5% of total sales, rose 13.4 percent in the third quarter, missing estimates, and decelerating from a 27% year-on-year expansion in the previous quarter.
Alphabet reported net profit of $9.2 billion, or $13.06 per share, compared with $6.7 billion, or $9.57 per share in the year-ago quarter.
For years, Amazon has made expensive bets on new technology and programs, like its $13.7 billion acquisition of Whole Foods in 2017 to storm the USA grocery industry. Analysts had previously forecast it would earn $US5.79 a share in the quarter.
In a time of low interest rates, Amazon and Google have offered investors the chance to hitch a ride on the fast-growing e-commerce, digital advertising and cloud-computing markets buoyed by a steady global economy, Bloomberg explained.More news: Wolves show 'no inclination to move' on Rockets' offer for Butler
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Amazon on Thursday reported third-quarter earnings that were more than $2 a share better than analysts had forecast.
"AMZN posted generally positive Q3 results-In-line Revenue with the highest Gross Margin we have seen in any third quarter & record high Operating Margin", a team led by the RBC analyst Mark Mahaney said in a note sent out to clients after the results. It purchased online pharmacy PillPack in June, which followed its US$13.7 billion acquisition of Whole Foods past year to jump start its grocery business. Shares in Europe and Asia also traded lower on Friday. Analysts projected $US3.9 billion. This is pretty impressive considering Amazon's primary North American retail segment pulled in over $34 billion in sales yet AWS booked just shy of $6.7 billion!
"And we're not slowing down - Amazon Business is adding customers rapidly, including large educational institutions, local governments, and more than half of the Fortune 100".
Operating cash flow increased 57 percent to $26.6 billion. About half of our Diwali sales previous year were in Q3.
The company now groups its advertising group under "other" on its balance sheet. Company CEO Jeff Bezos said, "The team is doing a fantastic job building and innovating for customers".
Amazon's stock closed regular trading up $US117.97 a share, or 7.1%, to $US1,782.17.