Post by Shadow on Feb 3, 2006 13:43:10 GMT -5
Bloomberg
Feb. 3 (Bloomberg) -- Amazon.com Inc. shares plunged as much as 13 percent, the biggest drop since October, after quarterly sales and a 2006 profit forecast disappointed investors.
Fourth-quarter sales rose 17 percent to $2.98 billion, falling short of analysts' estimates. Amazon.com's annual forecast for profit excluding expenses was below estimates. Two securities analysts cut their price forecasts for the stock today on concern about the company's growth.
Chief Executive Officer Jeff Bezos said yesterday Amazon.com ``deliberately'' increased spending to win customers. The results call into question whether Bezos' commitment to making investments will boost business and fend off competitors including EBay Inc. and Google Inc.
``The biggest issue continues to be they spend heavily for the future,'' said Tim Ghriskey, who helps manage more than $1 billion including Amazon.com shares at Solaris Asset Management in Bedford Hills, New York. ``Investors are anxious for the near term results. There's some skepticism on whether that spending is going to benefit the long term. They have to question if this is the right strategy.''
Amazon's Results
The shares fell $5.09, or 12 percent, to $37.65 at 11:36 a.m. in Nasdaq Stock Market trading. The last time the stock had a bigger decline was on Oct. 26, 2005. The stock tumbled as much as 9.9. percent yesterday in after-market trading.
Disappointing forecasts from Amazon.com, EBay, Google, and Apple Computer Inc. have damped investor enthusiasm for technology stocks and raised concerns about the growth prospects of the companies. Their forecasts are seen as harbingers of demand for technology products such as personal computers.
Feb. 3 (Bloomberg) -- Amazon.com Inc. shares plunged as much as 13 percent, the biggest drop since October, after quarterly sales and a 2006 profit forecast disappointed investors.
Fourth-quarter sales rose 17 percent to $2.98 billion, falling short of analysts' estimates. Amazon.com's annual forecast for profit excluding expenses was below estimates. Two securities analysts cut their price forecasts for the stock today on concern about the company's growth.
Chief Executive Officer Jeff Bezos said yesterday Amazon.com ``deliberately'' increased spending to win customers. The results call into question whether Bezos' commitment to making investments will boost business and fend off competitors including EBay Inc. and Google Inc.
``The biggest issue continues to be they spend heavily for the future,'' said Tim Ghriskey, who helps manage more than $1 billion including Amazon.com shares at Solaris Asset Management in Bedford Hills, New York. ``Investors are anxious for the near term results. There's some skepticism on whether that spending is going to benefit the long term. They have to question if this is the right strategy.''
Amazon's Results
The shares fell $5.09, or 12 percent, to $37.65 at 11:36 a.m. in Nasdaq Stock Market trading. The last time the stock had a bigger decline was on Oct. 26, 2005. The stock tumbled as much as 9.9. percent yesterday in after-market trading.
Disappointing forecasts from Amazon.com, EBay, Google, and Apple Computer Inc. have damped investor enthusiasm for technology stocks and raised concerns about the growth prospects of the companies. Their forecasts are seen as harbingers of demand for technology products such as personal computers.