Amazon misses earnings estimates for holidays, cites delivery costs

By Kyle Johnson,

Amazon released its holiday season earnings report, which showed a lower than expected income. The tech company blamed that on rising delivery costs.

According to USA Today, the internet giant earned $239 million from 25.6 billion in revenue during the fourth quarter, which is lower than the expected $318.9 million in net income.

The lowered income reports caused Amazon's stock to slip 8 percent down to $369 a share.

Businessweek notes that Amazon CEO Jeff Bezos has always put more stock into growing the company rather than its immediate earnings spent more on getting warehouses to quickly send out packages to customers during the holidays.

Wedbush Securities analyst Michael Pachter noted in a report on the company, "Amazon has consistently sacrificed near-term profitability in order to drive long-term growth."

The company also had to give some consumers rebates as package carriers were unable to compete with the amount of packages and were late for some.

Amazon has said that the Internet retailer expects sales during the first quarter will be about $18.2 billion to $19.9 billion, which hovers around the lower end of analysts' expectations.

image: Wikimedia Commons

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