Third quarter sales at Amazon advanced but increased expenses put a damper on earnings as the company prepared for the holiday season.
Net income for the quarter was $2.13 billion, or $4.23 per diluted share, versus $2.88 billion, or $5.75 per diluted share, in the period a year prior.
Amazon missed a MarketBeat-published analyst consensus earnings per diluted share estimate of $4.46 for the quarter, although the retailer beat the sales estimate by more than $1 billion.
Net sales increased $70 billion from $56.58 billion in the quarter year over year, Amazon reported. Net product sales advanced to $30.26 billion from $22.83 billion in the year-before period.
Operating income slipped to $3.16 billion versus $3.72 billion in 2018 quarter as the major components of operating expenses, cost of sales, fulfillment, marketing, technology and general and administrative, all increased.
In the third quarter, according to the company, the line-up of smart home products available through Amazon reached 85,000 from 9,500 brands. Amazon announced new Alexa smart home features and products, during the period, including the Certified for Humans program, which helps customers find smart home products that are simple to set up and use, and the all-new voice-controlled 4-in-1 Amazon Smart Oven.
Amazon and Discovery announced an integration that brings the new Food Network Kitchen service to Amazon devices as well as a deal to make Alexa the exclusive voice service for Food Network. Customers can watch Food Network episodes, get step-by-step cooking instructions, save recipes, ask questions and take live and on-demand cooking classes with Food Network chefs using Echo Show.
AmazonFresh expanded to Indianapolis, Houston, Minneapolis and Phoenix, where the company now offers the option of one- and two-hour delivery.
“We are ramping up to make our 25th holiday season the best ever for Prime customers with millions of products available for free one-day delivery,” said Jeff Bezos, Amazon founder and CEO, in announcing the financial results. “Customers love the transition of Prime from two days to one day: they’ve already ordered billions of items with free one-day delivery this year. It’s a big investment, and it’s the right long-term decision for customers. And although it’s counterintuitive, the fastest delivery speeds generate the least carbon emissions because these products ship from fulfillment centers very close to the customer. It simply becomes impractical to use air or long ground routes.”