For the holiday quarter ending Dec. 31, Amazon forecasts revenue between $160 billion and $167 billion, slightly below analysts' expectations. The company has been cutting costs aggressively, planning 27,000 layoffs and revealing more role reductions. Amazon's same-day delivery services have also boosted its margins by encouraging shoppers to place more frequent and larger orders. Despite these efforts, the company warns that consumers remain cautious about spending going into the holiday quarter.
Key takeaways:
- Amazon's cloud business growth is stabilizing with new deals, but the company warns of consumer caution about spending in the upcoming holiday quarter.
- The company is facing challenges including tight household budgets, businesses scrutinizing their cloud spending, and a lawsuit by the U.S. Federal Trade Commission accusing Amazon of inflating prices and wielding monopoly power.
- Amazon Web Services (AWS) brought in revenue of $23.1 billion in the third quarter, and the company's overall revenue rose 13% to $143.1 billion, beating Wall Street estimates.
- Amazon has aggressively cut costs, including planning 27,000 layoffs, and has reorganized its delivery network to locate goods closer to shoppers, allowing for faster and cheaper order fulfillment.