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Amazon Revenue Misses Forecasts; Shares Dive

Amazon.comshares plunged in extended trading Thursday on concerns about the merchant's operating margins and after the firm reported revenue that was below what Wall Street expected.

Amazon.com's fulfillment center in Fernley, Nevada.
Ben Margot
Amazon.com's fulfillment center in Fernley, Nevada.

The online retailer reported fourth-quarter earnings of 91 cents a share. Amazon earned 85 cents a share during the same period a year earlier.

Sales for the most recent quarter rose to $12.95 billion, up from $9.52 billion last year.

The company was expected to earn 88 cents a share on revenue of $13.01 billion, according to a consensus estimate from Thomson Reuters.

For the current quarter, Amazon said it expects revenue between $9.1 billion and $9.9 billion and operating profit between $260 million and $385 million, including $140 million for stock-based compensation and asset amortization.

Wall Street expected revenue of $9.31 billion, according to Thomson Reuters. Investors were also concerned about the retailer's operating margins, according to analysts.

"Operating income (guidance) for the first quarter is well below the consensus and the stock is taking a big hit. It could be that they're back to spending mode," said Tim Ghriskey, CIO of Solaris Asset Management.

"The slight miss on revenue for the fourth quarter is noise," he continued. "They're going to have to explain what the operating income (forecast) miss is. That's a decline from the first quarter of last year and well below expectations. I'm very curious what's going on."

Shares of Amazon plunged almost 10 percent in extended trading Thursday. Get after-hour quotes for Amazon.com.

Earlier, the shares climbed more than 5 percent to closed at $184.45 in the regular New York Stock Exchange session. Volume exceeded 9.7 million shares before the closing bell.

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