Amazon’s Earnings Top Estimates, Though Its Forecast Underwhelms

Amazon (AMZN) reported fourth-quarter earnings that topped analysts’ estimates, though its outlook underwhelmed, sending shares lower in extended trading Thursday.

The e-commerce and cloud services giant saw net sales rise 10% year-over-year to $187.8 billion, surpassing the analyst consensus from Visible Alpha. Earnings came in at $20 billion, or $1.86 per share, up from $10.62 billion, or $1 per share, a year earlier, also above expectations.

The gains came as Amazon said the holiday shopping season proved its “most successful yet.” Online store sales grew 7% to $75.56 billion, above estimates. Meanwhile, revenue from Amazon Web Services increased 19% to $28.79 billion, just shy of projections. 

Revenue To Take a Hit From Foreign Exchange

Looking ahead however, Amazon forecast first-quarter revenue of between $151 billion and $155.5 billion, below the analyst consensus of $158.58 billion.

Amazon said the outlook reflects “an unusually large, unfavorable impact” from foreign exchange rates, to the tune of $2.1 billion.

Amazon Joins Peers With Big AI Spending Plans

Much like several of its Big Tech peers, Amazon also said it plans to boost spending on artificial intelligence.

CEO Andy Jassy told investors on the company’s earnings call that the $26.3 billion Amazon spent on capital expenditures in the fourth quarter is “reasonably representative” of the rate it will likely spend in 2025. That would bring Amazon’s capital expenditures over $100 billion for the full year, the “vast majority” of which would go toward AI for AWS, he said.

Just earlier this week, Google parent Alphabet (GOOGL) forecast $75 billion in capital expenditures this year to support expanding its AI capacity. Last week, Meta (META) said it plans to invest $60 billion to $65 billion this year, while Microsoft (MSFT) said it plans to spend $80 billion on infrastructure in its 2025 fiscal year.

Shares of Amazon fell over 4% in extended trading following the company’s earnings call. The stock had gained about 40% over the past 12 months through Thursday’s close.

UPDATE—Feb. 6, 2025: This article has been updated since it was first published to include additional information and reflect more recent share prices.