Amazon experiences largest annual loss since becoming public despite beating analyst's Q4 expectations

Per Washington Business Journal

Amazon became public on May 15, 1997, and since then, the company has never experienced an annual loss as massive as it did in 2022. Despite beating analysts' Q4 expectations, the company still lost $2.7 billion on $514 billion in sales.

The recent company postings revealed that it beat analysts' Q4 expectations by posting a $149.2 billion revenue for the quarter. Although good news for the company, it was followed by another announcement of losing $2.7 billion on $514 billion in sales.

The losses came from between Amazon's cloud and retail divisions and resulted in the lowest point for the company in almost a decade. In 2014, the company didn't make a profit and was in the red by $241 million.

Amazon's Q4 profits also fell from $33 billion in 2021 to just $300 million in 2022. This came as the rising rates affected consumers' buying decisions.

As noted by Biz Journals, another reason Amazon lost money was that it invested in Rivian Automotive Inc., which lost a pretax valuation of $12.7 billion. Company CEO Andy Jassy said that their approach would be to cut costs.

Jassy: "We’re also encouraged by the continued progress we’re making in reducing our cost to serve in the operations part of our Stores business... In the short term, we face an uncertain economy, but we remain quite optimistic about the long-term opportunities for Amazon."

The company announced its budget for theatrical film releases, saying they will be spending $1 billion a year to make 12 to 15 movies. The company said that it would only be producing a smaller number of films in 2023.

While the company stock rose during the pandemic, it lost all its pandemic gains towards the end of 2022, as its stock dropped massively. This came as other Big Tech stocks also experienced massive drops as well.

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Washington Business Journal