Amazon.com, Inc. (NASDAQ:AMZN) stock fell 5.50% (As on February 3, 11:18:36 AM UTC-4, Source: Google Finance) after the company missed fourth-quarter profit expectations, reported a much wider-than-expected 2022 loss and warned of a first-quarter miss. Amazon has been struggling to right-size its business in the past year as consumers pulled back from the pandemic-induced move towards online shopping. To keep up with the demand at the time, it boosted hiring at its corporate offices and its warehouses, nearly doubling its workforce to more than 1.6 million by the beginning of last year. But as its retail business cooled, Amazon has been attempting to curb expenses that have outpaced sales in its North America and international businesses since the fourth quarter of 2021. It spent some of last year reducing its warehouse workforce through attrition, and cancelling or delaying plans to open warehouses in different parts of the country.
AMZN in the fourth quarter of FY 22 has reported the adjusted earnings per share of 3 cents, missing the analysts’ estimates for the adjusted earnings per share of 17 cents, according to FactSet. The e-commerce giant said its bottom line was dented by a $2.3 billion write-down of the value of its stock investment in electric vehicle startup Rivian Automotive. Amazon’s fourth quarter profits represent a significant drop from the $14.3 billion it posted during the same period in 2021, when the company had a nearly $12 billion gain from its investment in Rivian Automotive. The company had reported the adjusted revenue growth of 9 percent to $149.2 billion in the fourth quarter of FY 22, beating the analysts’ estimates for revenue of $145.7 billion.
Moreover, North America segment sales increased 13% year-over-year to $93.4 billion, or increased 14% excluding changes in foreign exchange rates. International segment sales decreased 8% year-over-year to $34.5 billion, or increased 5% excluding changes in foreign exchange rates. AWS segment sales increased 20% year-over-year to $21.4 billion. Operating income decreased to $2.7 billion in the fourth quarter, compared with $3.5 billion in fourth quarter 2021. Operating cash flow increased 1% to $46.8 billion for the trailing twelve months, compared with $46.3 billion for the trailing twelve months ended December 31, 2021. Free cash flow decreased to an outflow of $11.6 billion for the trailing twelve months, compared with an outflow of $9.1 billion for the trailing twelve months ended December 31, 2021.
The company expects revenue of between $121 billion and $126 billion during the current quarter. Analysts had been expecting $125 billion.