SEATTLE — Amazon’s fourth-quarter sales hit a record $72.4 billion, leading to a $3 billion profit.
Both revenue and profit exceeded Wall Street analysts’ expectations, on average. But the company’s 19.7 percent year-over-year sales growth represented a substantial slowdown, due in part to the law of large numbers. It’s harder to keep growing fast with quarterly sales that stretch to 11 digits.
The company said in its earnings report Thursday that it expects sales growth to slow further in the current quarter. Amazon expects to start 2019 with quarterly sales of $56 billion to $60 billion, up 10 percent to 18 percent. Excluding an expected foreign-exchange impact, the growth rate would be about 2 percentage points higher, said Chief Financial Officer Brian Olsavsky.
He pinned some of the uncertainty on India, where the government is implementing new rules that place limitations on foreign e-commerce companies.
Amazon shares were trading down less than 1 percent in the first hour of extended trading after the earnings release. Shares closed the regular trading session Thursday up 2.9 percent at $1,718.73.
Amazon’s fourth-quarter profit was just below the earnings the company recorded for the entire year in 2017. Amazon’s full-year 2018 profit — $10.1 billion — is more than triple the year-earlier result. Sales for the full year grew 31 percent to $232.9 billion.
Sales in the company’s computing and software rental business — Amazon Web Services — continued their rapid rate of growth, increasing 45 percent in the quarter to $7.4 billion and generating nearly $2.2 billion in operating income. AWS accounted for 10 percent of the company’s net sales in the quarter, up from 8 percent in the year-earlier period.
Amazon’s “other” business segment — consisting mainly of its fast-growing advertising business — generated nearly $3.8 billion in sales in the quarter, up 97 percent.
The company ended the quarter with 647,500 employees globally, up 14 percent. On Nov. 1, Amazon raised its companywide minimum wage to $15 an hour, a move it said benefited some 250,000 employees in the U.S.
Investors are watching for any potential fallout at Amazon from the divorce of founder and CEO Jeff Bezos. Olsavsky had no comment when asked whether Bezos has any plans to sell shares or reduce his stake in the company, which stands at just over 16 percent.
