Amazon’s Q3 results under fire!

Amazon recently released its third quarter financial results, and the news rocked company’s share. The company’s Q3 results missed analyst’s estimates, and aggravating the situation, the firm forecasted that its Q4 (famously known as holiday quarter) will be no different. The company is expected to garner more than $40 billion quarterly sales in Q4, however, with minimal profits. In Q4, its operating expenses are expected to rise significantly in from the Q3 number of $32.1 billion on the back of investments in India, refinements to voice-activated Amazon Echo products and construction of new data centers for Amazon Web Services, the company’s cloud-computing division.

Amazon is famously known for its strategy of prioritizing investment over profits. The company has been running on “Investment First” philosophy for most of its existence, however, the current year was an exception. For the first two quarters, Amazon reported widening profit margins complemented by robust sales growth, leading to a 25% uplift in the company’s stock. Though it fell ~5% the day Amazon reported its Q3 numbers.

CFO Brian Olsavsky told investors that Amazon would continue to invest in new initiatives that enhance the customer experience, hoping to find successes like its fast-growing and profitable cloud-computing segment and its $99-a-year Prime membership that converts occasional Amazon shoppers into its most loyal customers and biggest spenders.

In India, the firm is engaged in a three face battle, with Flipkart and Snapdeal as the other two competitors, and looking to expand its market share on the back to significant planned investment.