Amazon today reported its results for the company’s first financial quarter of 2014. Amazon reported net sales up 23 percent to $19.74 billion compared to $25.59 billion last quarter and $16.07 billion in the year-ago quarter. Operating income, however, decreased 19% to $146 million in the first quarter, compared with $181 million in first quarter 2013.
Ahead of the earnings, analysts expected the company to report earnings of $0.23 a share and revenue of $19.43 billion. Amazon’s own guidance was for between $18.2 billion and $19.9 billion in net sales and for operating income to come in somewhere between a $200 million loss and a $200 million profit. Most analysts expected Amazon to come in around the high end of the company’s own estimates, so there will be some disappointment there.
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Given that Amazon’s earnings are often unpredictable and the company doesn’t always focus on profits as much as some shareholders would like it to, it’s worth noting that there was a wide margin of opinions among analysts, with the lowest estimate coming in at a loss of 1 cent per share and the highest clocked in at earnings of $0.52 per share.
Despite the fact that Q1 is traditionally a slower quarter for retailers, Amazon made a wide range of announcements over the last few months, including its price hike for Amazon Prime and the launch of its $99 Fire TV media streaming box. The company also recently announced that it had signed a deal with HBO to get more content for its streaming service.
While it’s unclear how much this influenced Amazon’s earnings in this quarter, a new report also argues that the company is losing sales in those states where it is forced to collect sales tax now.
Sadly, while Amazon likes to stuff its earnings releases with numerous minor facts about its products, it doesn’t release separate numbers for its different business units. It’s still a company secret, for example, how much profit it makes from its AWS cloud computing platform (or how much loss it incurs from it). In the cloud computing space, Amazon is currently embroiled in a price war with Google and Microsoft.
Typically, Amazon announces a number of interesting facts about the business in its release, but this time around, the company simply decided to recap its news from the last quarter.
Amazon’s guidance for the next quarter includes net sales of $18.1 billion to $19.8 billion and the expectation of an operating loss between $455 million and $55 million.