Amazon (AMZN) stock drops 20% on lower Q4 2022 revenue guidance

Amazon (AMZN) shared its Q3 2022 earnings today and due to lower Q4 revenue guidance, the company’s stock has dropped 20 percent. Originally, Amazon expected $155 billion, but are now expecting $140 to $148 billion. Not only is this a large reduction from Amazon’s initial expectations, the updated wide range implies a degree of uncertainty as well.

Other details included in the company’s Q3 2022 earnings report include net income decreasing $2.9 billion in the third quarter or $0.28 per diluted share in comparison with $3.2 billion or $0.31 per diluted share back in Q3 2021.

Touching upon recent Amazon events including Prime Day, CEO Andy Jassy notes there is “a lot happening in the macroeconomic environment” with plans to balance the company’s investments “to be more streamlined” without compromising key long-term strategic bets.

“In the past four months, employees across our consumer businesses have worked relentlessly to put together compelling Prime Member Deal Events with our eighth annual Prime Day and the brand new Prime Early Access Sale in early October. The customer response to both events was quite positive, and it’s clear that particularly during these uncertain economic times, customers appreciate Amazon’s continued focus on value and convenience,” said Andy Jassy, Amazon CEO.

“We’re also encouraged by the steady progress we’re making on lowering costs in our stores fulfillment network, and have a set of initiatives that we’re methodically working through that we believe will yield a stronger cost structure for the business moving forward. There is obviously a lot happening in the macroeconomic environment, and we’ll balance our investments to be more streamlined without compromising our key long-term, strategic bets. What won’t change is our maniacal focus on the customer experience, and we feel confident that we’re ready to deliver a great experience for customers this holiday shopping season.”

Overall, it’s interesting to see Amazon updating its Q4 2022 guidance with lower expectations. Not only this, but seeing Amazon’s updated expectations ranging anywhere from $140 to $148 billion.

For more on Amazon’s Q3 2022 performance, be sure to read through the full earnings report. Also check out some of our previous coverage including where you can listen to the Amazon (AMZN) Q3 2022 earnings call, and Amazon CEO Andy Jassy recently being accused of violating labor laws with anti-union comments.