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E-commerce giant Amazon's shares fell sharply as the company reported a loss in its first-quarter results for the first time since 2015.
The company reported a 7.3% rise in revenues as the figures grew to $116.4 billion, but lower than the figures that analysts had predicted. Its product sales declined a little over $1 billion while its services segment grew 17.6% with around $60 billion in revenues.
The company's operating expenses rose as global inflation was on the higher side. The expenses rose 13.17% as the company's operating expenses for the quarter amounted to $112.8 billion. A large part of the losses was the loss of value of its investment in Rivian Automotive amounting to $7.6 billion.
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The loss amounts to a loss per share of $7.56 per share. In North America, the company's revenues rose, by about 8%, as well as its operating expenses. However, its revenues fell 6% internationally while its operating expenses rose marginally.
Amazon Web Services posted impressive growth as its sales grew 37% YoY to $18.44 billion. The segment managed to land several large clients during the quarter such as T-systems, Verizon, Bundesliga, Boring & Tech Mahindra.
Amazon is bearing the brunt of rising inflation and supply chain issues. Amazon has forecasted its sales for the current quarter at $116-121 billion, well below the existing estimates of $125.33 billion by analysts.
The stock was severely affected by the results as it opened 10.2% below the previous closing price and fell a further 4%, touching price levels that it hadn't touched since April 2020, to finally close at $2,485.63 per share.
Article by Aman Agarwal.
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