Amazon operating income drops and AWS margins contract

Amazon issued a press release on their third quarter results after the market closed.

Revenue increased by 24% to $70B, but operating income was down and margins for AWS and North America contracted.

In terms of cloud Microsoft Azure grew 59% YoY in the previous quarter. Microsoft is definitely catching up, and there might be a kink in the armour of Amazon.

Revenue from cloud (USDm)

Media coverage

Reuters – Amazon’s gloomy holiday forecast misses estimates, shares fall 7%

Bloomberg – Amazon’s One Sure Thing Starts to Look Shaky

Forbes – Why Amazon’s Costly One-Day Shipping Bet May Pay Big Dividends

New York Times – Amazon’s Profit Falls Sharply as Company Buys Growth

CNBC – Amazon clobbered after a miss on the bottom line and soft guidance

CNBC – Amazon’s cloud business reports 35% growth in the third quarter, trailing estimates

14Oct Morningstar – How Do You Value Amazon Heading Into 2020?

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