Amazon stock dives over 20% on downbeat sales forecast
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Amazon (NASDAQ:AMZN) shares erased hundreds of billions in market cap in Thursdayâs extended session after offering a less than optimistic forecast for the fourth quarter. Indeed, the over 20% drop equates to about the market cap of Meta Platforms after its own plunge on Thursday.
The Seattle-based tech giant posted a mixed third quarter result wherein net sales came in at $127.1B and earnings per share reached $0.28. Wall Street had anticipated the Andy Jassy-led giant to report $0.21 in EPS and $127.47B in revenue for the quarter. For the first 9 months of 2022, the company has recorded a $3B loss as compared to $19.04B in net income recorded in the prior year period. 
Operating income decreased to $2.5B in the third quarter, compared with $4.9B in the third quarter of 2021, due to operating losses in both North America and International segments that dragged on $5.4B in income from AWS. The earnings release added that third quarter net income includes a pre-tax valuation gain of $1.1B from the companyâs investment in Rivian Automotive (RIVN).
âWeâre also encouraged by the steady progress weâre making on lowering costs in our stores fulfillment network, and have a set of initiatives that weâre methodically working through that we believe will yield a stronger cost structure for the business moving forward,â CEO Andy Jassy commented. âThere is obviously a lot happening in the macroeconomic environment, and weâll balance our investments to be more streamlined without compromising our key long-term, strategic bets.â
However, the companyâs conservative outlook appeared to upset the market after hours. Amazon (AMZN) said it expects revenue between $140B and $148B, well short of the $155.37B consensus estimate. Additionally, operating income is expected to be between $0 and $4B. 
Shares of Amazon (AMZN) fell 20.47% in after hours trading on Thursday.
A number of other e-commerce stocks dove in sympathy with the sector leader during the day's extended session. Notable decliners included Wayfair (W) -7.07%, Etsy (ETSY) -6.85%, eBay (EBAY) -4.64%, Chewy (CHWY) -3.77%, and Farfetch (FTCH) -3.15%.
Dig into the details of the results.