Shares are down 10.2% in post market trading after the e-retailer reported a far bigger Q2 loss than investors expected. Amazon lost $126M, up from a $7M loss in the period last year, on revenues of $19.3B, +23.2%. The top line was right on target with analysts’ consensus forecast. But the loss at 27 cents a share far exceeded the 15 cent loss the Street anticipated. What’s more, Amazon warns that it could lose as much as $810M on an operating basis in Q3, up from last year’s $25M loss.
The shortfall comes from Amazon’s big investments in new products and services, including video. The company says it plans to spend $100M on original video content in the current quarter, far more than last year or in Q2. Funds also are going to build fulfillment centers, a subscription book service, the Kindle Fire TV streaming box, and its Fire smartphone.
“We continue working hard on making the Amazon customer experience better and better,” CEO Jeff Bezos says in the earnings release.