Amazon.com (NASDAQ:AMZN) Trading Down 5.6% on Disappointing Earnings

Amazon.com, Inc. (NASDAQ:AMZN) shares dropped 5.6% during mid-day trading on Friday following a dissappointing earnings announcement. The company traded as low as $200.31 and last traded at $210.32. Approximately 179,639,031 shares were traded during mid-day trading, an increase of 258% from the average daily volume of 50,150,563 shares. The stock had previously closed at $222.69.

The e-commerce giant reported $1.95 earnings per share for the quarter, missing the consensus estimate of $1.97 by ($0.02). Amazon.com had a net margin of 11.06% and a return on equity of 23.62%. The firm had revenue of $213.39 billion for the quarter, compared to the consensus estimate of $211.02 billion. During the same quarter in the prior year, the firm earned $1.86 earnings per share. The company’s revenue for the quarter was up 13.6% compared to the same quarter last year.

Key Amazon.com News

Here are the key news stories impacting Amazon.com this week:

• Positive Sentiment: AWS and sales beat/strength — Amazon reported solid Q4 revenue and faster AWS growth, reinforcing the cloud growth thesis. AWS Q4 beat (CNBC)
• Positive Sentiment: Anthropic stake re‑valuation — Amazon’s earlier $8B investment in Anthropic is now being valued much higher (~$60.6B), underlining upside in AI partnerships and non‑core assets. Anthropic valuation (Business Insider)
• Positive Sentiment: Near‑term tax relief improves cash flow — Recent U.S. tax changes materially reduced Amazon’s federal tax cash outlays in 2025, which helps fund heavier capex without a proportional hit to free cash flow. Tax law reduces Amazon tax bill (WSJ)
• Neutral Sentiment: Management stance — CEO Andy Jassy said he’s “confident” the $200B program will deliver attractive returns over time; that defends the strategy but leaves timing/ROIC execution risk. CEO confidence (CNBC)
• Neutral Sentiment: New ad/AI product moves — Amazon is opening ad platform capabilities to AI agents (Ads MCP server beta), which could expand ad monetization but will take time to scale. Ads MCP beta (Newsfile)
• Negative Sentiment: CapEx shock and small EPS miss spooked traders — Amazon guided to roughly $200B in 2026 capex (well above expectations) and reported a slight EPS miss; that combination triggered heavy selling and a sharp gap lower in after‑hours/premarket trading. $200B capex guide (Reuters)
• Negative Sentiment: Regulatory and analyst pushback — Germany’s cartel office banned certain marketplace pricing controls and ordered repayments, adding regulatory risk; several firms also trimmed near‑term targets or flagged margin/cash‑flow risk tied to heavy capex. Germany antitrust (Reuters)

Wall Street Analyst Weigh In

AMZN has been the subject of a number of analyst reports. Rosenblatt Securities reduced their price objective on shares of Amazon.com from $305.00 to $296.00 and set a “buy” rating for the company in a research note on Friday. Canadian Imperial Bank of Commerce upped their target price on shares of Amazon.com to $315.00 in a research note on Monday, October 20th. New Street Research boosted their price objective on shares of Amazon.com from $340.00 to $350.00 and gave the stock a “buy” rating in a research note on Thursday, January 8th. Pivotal Research upped their target price on Amazon.com from $285.00 to $300.00 and gave the company a “buy” rating in a research report on Friday, October 31st. Finally, Guggenheim reaffirmed a “buy” rating and set a $300.00 price target on shares of Amazon.com in a research report on Friday. Fifty-five analysts have rated the stock with a Buy rating and four have assigned a Hold rating to the stock. According to data from MarketBeat.com, the company has a consensus rating of “Moderate Buy” and a consensus price target of $290.28.

Insider Buying and Selling

In related news, CEO Matthew S. Garman sold 17,768 shares of the stock in a transaction on Friday, November 21st. The stock was sold at an average price of $216.90, for a total value of $3,853,879.20. Following the transaction, the chief executive officer owned 6,273 shares of the company’s stock, valued at $1,360,613.70. This represents a 73.91% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available through this hyperlink. Also, Director Keith Brian Alexander sold 900 shares of Amazon.com stock in a transaction on Monday, November 17th. The stock was sold at an average price of $233.00, for a total transaction of $209,700.00. Following the sale, the director owned 7,170 shares in the company, valued at $1,670,610. This represents a 11.15% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 47,061 shares of company stock worth $10,351,262 over the last ninety days. Company insiders own 9.70% of the company’s stock.

Hedge Funds Weigh In On Amazon.com

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. Vanguard Group Inc. raised its stake in shares of Amazon.com by 2.1% in the 2nd quarter. Vanguard Group Inc. now owns 849,721,601 shares of the e-commerce giant’s stock worth $186,420,422,000 after buying an additional 17,447,045 shares in the last quarter. State Street Corp raised its position in Amazon.com by 2.0% in the third quarter. State Street Corp now owns 381,681,441 shares of the e-commerce giant’s stock worth $83,805,794,000 after acquiring an additional 7,584,156 shares in the last quarter. Geode Capital Management LLC boosted its position in shares of Amazon.com by 1.7% during the 2nd quarter. Geode Capital Management LLC now owns 216,717,657 shares of the e-commerce giant’s stock valued at $47,332,625,000 after purchasing an additional 3,721,658 shares in the last quarter. Norges Bank bought a new position in shares of Amazon.com during the 2nd quarter valued at about $27,438,011,000. Finally, Northern Trust Corp grew its position in Amazon.com by 0.3% in the first quarter. Northern Trust Corp now owns 97,379,134 shares of the e-commerce giant’s stock worth $18,527,354,000 after buying an additional 302,858 shares during the last quarter. Institutional investors and hedge funds own 72.20% of the company’s stock.

Amazon.com Stock Down 5.6%

The stock has a fifty day moving average of $233.97 and a 200-day moving average of $229.91. The company has a current ratio of 1.01, a quick ratio of 0.80 and a debt-to-equity ratio of 0.14. The firm has a market capitalization of $2.25 trillion, a price-to-earnings ratio of 29.71, a PEG ratio of 1.45 and a beta of 1.37.

About Amazon.com

Amazon.com, Inc is a diversified technology and retail company best known for its e-commerce marketplace and broad portfolio of consumer and enterprise services. Founded by Jeff Bezos in 1994 and headquartered in Seattle, Washington, the company launched as an online bookseller and expanded into a global retail platform that sells products directly to consumers and provides a marketplace for third-party sellers. Over time Amazon has grown beyond retail into areas including cloud computing, digital media, devices and logistics.

Key businesses and offerings include Amazon’s online marketplace and fulfillment services, the Amazon Prime membership program (which bundles expedited shipping with streaming and other benefits), Amazon Web Services (AWS) which supplies on-demand cloud computing and storage to businesses and public-sector customers, and a range of content and advertising services such as Prime Video and Amazon Advertising.