Amazon lost $274 million, or 60 cents a share in the third quarter ended September 30 on $13.81 billion in sales. Wall Street's consensus estimates were for an 8 cent-per-share loss on $13.92 billion in quarterly revenue, according to First Call. During the year-earlier period, Amazon earned $63 million, or 14 cents a share, on $10.9 billion in sales.
The quarter included a $169 million loss related to Amazon's daily deals business, LivingSocial.
This was Amazon's second consecutive quarterly disappointment after beating forecasts in the prior two quarters. Following the release of the results, shares of Amazon tumbled more than 5 percent in after-hours trading.
Investors may also have been spooked by the company's guidance for the fourth quarter. Amazon said that it expects anywhere between a $490 million loss and a $310 million profit on sales between $20.25 billion and $22.75 billion.
Amazon's earnings conference call is scheduled for 2 p.m. PT today.
"Our approach is to work hard to charge less. Sell devices near breakeven and you can pack a lot of sophisticated hardware into a very low price point," said Amazon Jeff Bezos in a prepared statement.
- North America sales, including revenue from Amazon Web Services: $7.88 billion, up 33 percent
- International: $5.92 billion, up 20 percent
- Worldwide Media sales: Up 11 percent to $4.60 billion.
- Worldwide Electronics and Other General Merchandise sales: Up 36 percent to $8.56 billion
The world's largest online retailer's spending strategy is likely to invite scrutiny on the conference call. For years, Bezos has demonstrated a preference for plowing resources into initiatives to build market share which take years to generate profits. But that seeming indifference to near-term profits drives Wall Street batty. Bezos is not backing down. In fact, he recently told the BBC that Amazon's selling the Kindle Fire HD and Paperwhite e-reader at cost.
Amazon's stock, which started the year just above $175 a share, has been one of tech's strongest performers. The stock closed today at $227.55.
Correction: An earlier version of this post misstated the possible operating loss Amazon included with its fourth-quarter guidance. Amazon said that it expects anywhere between a $490 million loss and a $310 million profit on sales between $20.25 billion and $22.75 billion.