Amazon, one of the biggest companies in the world, recently released its fourth-quarter earnings report, and the news wasn’t as bright as many had hoped. While the retail giant did post record revenues, its cloud computing division, Amazon Web Services (AWS), fell short of expectations, causing the company’s stock to drop significantly in after-hours trading. Investors had their eyes on the numbers, waiting to see if Amazon could keep up the momentum it has built over the past year.
Shares Flop Despite Record Revenue
Amazon reported a stunning record revenue of $187.8 billion for the last quarter of 2023, which sounds impressive, right? However, the excitement faded quickly when the stock saw a 4% decline following the news. This decline came even though Amazon’s earnings per share were $1.86, beating Wall Street’s expectations of $1.49. It shows just how high the stakes are for the company and how investors react when things don’t go exactly as planned.
AWS Fails to Surprise Traders
The real concern for investors was the performance of AWS, Amazon’s cloud computing service, which made $28.8 billion in revenue—an increase of 19% from the previous year. While that might sound good at first, it fell short of the anticipated $28.87 billion. CEO Andy Jassy explained that inconsistent chip supplies affected their performance, which left many wondering if Amazon could regain its footing in this vital segment of their business.
Key Support Levels to Watch
As the stock price dipped, analysts began discussing crucial price levels that investors should pay attention to. If you’re curious, these support levels are around $230, $216, and $200 per share. This means if the stock price drops to these points, it might bounce back, and traders will be closely watching these levels in the coming days. However, some analysts believe there’s potential for a price target of around $290 if the stock can recover from its current slump.
Measured Move Price Target to Monitor
Investors are also looking at what’s known as a “measured move” price target. If Amazon can turn things around and if the growth returns, analysts are hopeful that the price could head toward $290. This optimism is built on the belief that, despite the recent downturn, Amazon shares have gained about 9% since the beginning of the year and have soared over 40% in the last twelve months.
Why This Matters
This is all quite important because it doesn’t just affect Amazon. The tech market is sensitive, and what happens to major players like Amazon can influence many other companies and the overall stock market. Investors are on high alert, and they will be watching to see how Amazon navigates these challenges moving forward. Will they find a way to overcome the hurdles in their cloud services? Or will the drop in stock price shake investor confidence more? Only time will tell—but for now, we’ll need to keep an eye on these developments as they unfold.
| Category | Q4 2023 Performance | Expectation |
|---|---|---|
| Revenue | $187.8 Billion | – |
| EPS (Earnings Per Share) | $1.86 | $1.49 |
| AWS Revenue | $28.8 Billion | $28.87 Billion |
| Year-over-Year Growth (AWS) | 19% | – |