Amazon has announced robust earnings for the fourth quarter, yet its stock prices have taken a hit due to a cautious outlook for the first quarter.

Amazon has announced impressive financial results for the fourth quarter of 2024, exceeding analysts’ expectations with strong earnings and revenue growth. However, despite this positive performance, the company’s stock saw a significant decline after it shared a cautious outlook for the first quarter of 2025.

Q4 Performance Exceeds Expectations Amazon’s earnings report for Q4 highlighted a strong performance, largely fueled by substantial growth in its cloud computing division, Amazon Web Services (AWS), along with continued strength in its e-commerce sector. The company reported a revenue of $145 billion, reflecting a 10% increase compared to the same period last year. Net income for the quarter reached $12.5 billion, which is a 15% year-over-year increase.

AWS, Amazon’s cloud services platform, remained a key driver of its earnings, generating $24 billion in revenue, which represents a 20% growth year-over-year. The platform’s ongoing leadership in the cloud market has been crucial to Amazon’s financial success, even as the company faces increased competition in the industry.

At the same time, Amazon’s e-commerce business demonstrated resilience with strong holiday season sales, especially in North America and international markets.

The company also reported growth in its subscription services, including Amazon Prime memberships and Amazon Fresh, both of which have continued to perform well. Stock Dip Despite Strong Results Despite the solid financial performance in Q4, Amazon’s stock experienced a downturn after the company provided its earnings guidance for the first quarter of 2025.

The company cautioned about potential challenges in the upcoming quarter, pointing to rising inflationary pressures, increased operational costs, and a possible slowdown in consumer spending. These concerns led to a more cautious outlook, which unsettled investors.