Amazon Share Price Tumbles 11% After Posting 1st Loss In 7 Years
Amazon dropped 11% Friday after posting its first quarterly loss in seven years, wiping more than $160 billion off the company's market value, Harry Robertson reported for Business Insider.
Photo Insert: The company said its major investments in warehouses and staff during the coronavirus pandemic were catching up with it as uncertainty grows about consumer spending.
The e-commerce giant was down 11.26% at $2,568.50 as of 2.41 p.m. ET as investors reacted to the company's first quarter earnings, which were released after the bell Thursday. Amazon suffered a loss of $3.84 billion in the first quarter, down from a profit of $8.11 billion in the same period a year earlier.
The bottom line was hit hard by a $7.6 billion reduction in the value of its stake in electric-car maker Rivian, whose shares have crashed almost 70% this year. Amazon reported its slowest-ever quarterly revenue growth, with a rise of 7.3% year-on-year to $116.44 billion.
The company said its major investments in warehouses and staff during the coronavirus pandemic were catching up with it as uncertainty grows about consumer spending.
"Today, as we're no longer chasing physical or staffing capacity, our teams are squarely focused on improving productivity and cost efficiencies throughout our fulfillment network," CEO Andy Jassy said in a statement released with the earnings results.