Amazon stock drops on Q4 earnings, slowing AWS growth
Amazon shares slide lower in the after-hours trading session despite following a Q4 revenue beat and earnings miss.
SEANA SMITH: And let's take a look at Amazon because we're now looking at broader losses here in extended trading, off just about 3% right now. I mentioned the fact that their sales number did beat expectations, but net income, it was a miss on that in terms of what the Street was expecting to see.
Some of that valuation markdown of Amazon's stake in Rivian is to blame there, the company taking a $2.3 billion pretax hit. Amazon owns about 17% of shares there.
Also AWS, we know that was a focal point in this report. Revenue there, 21.38 billion. Yes, that's up 20% year over year, but it did lightly mist the Street's expectations there. And of course, this follows what we heard from Microsoft last week, their Azure division there, disappointing results from cloud. And of course, we saw the reaction in Amazon's stock after that report.
It will be interesting to keep an eye on Microsoft this afternoon here in extended trading. But again, it looks like the Street isn't too happy with these results when you drill down into that net income miss and also the fact that AWS revenue coming up just a bit light there.
SEANA SMITH: Still an AWS story. We expected some slowing cloud growth. 20% ain't bad, but not when you're used to a far larger number. Can't help but wonder if more layoffs are going to be mentioned. A lot of attention on the 18,000 layoffs there at Amazon.
You've got to remember they increased headcount 800,000 from 2019 to 2021. So will they find a way to cut expenses?
BRAD SMITH: Yeah, and so many different businesses that are accounted for within Amazon, whether it's the e-commerce front or whether it is that Azure and web services front as well here.