What's Inside

Amazon profits fall for the first time in more than two years thanks to high one-day delivery costs. ·

• Amazon.com reported 3Q19 revenues of $70.0 billion, up 23.7% year over year and above the consensus estimate of $68.8 billion to $63.5 billion. However, EPS was $4.31, down 27.1% year over year and below the $4.59 consensus estimate.
• AWS revenue growth slowed, to 34.7% from 37.3% the prior quarter. But still, AWS contributed 71.6% of corporate operating income.
• The company guided for 4Q19 revenues of $80.0-86.5 billion (up 11-20% year over year), below the consensus estimate of $87.39 billion; and provided guidance of operating income of $1.2-2.9 billion, far below the $4.2 billion consensus estimate.

But earnings per share (EPS) declined from $5.91 to $4.31 a share, the first time Amazon earnings have shrunk year-over-year since June 2017, and below the consensus of $4.59 a share, according to FactSet.