Amazon reported very strong quarterly results across the business... until its conference call.
👉 Background: Over the past week, everyone has been tuning into the quarterly earnings of the FAANG companies to see how they are weathering the economy. And surprisingly, all the companies have performed relatively strongly, including Amazon.
👉 What happened: The Zon reported very strong quarterly results across the business, especially in its Amazon Web Services (AWS) division. As a result, the share price of Amazon jumped more than 10%.
👉 What else: But later that evening, on a conference call, an Amazon spokesperson admitted that in April, AWS was tracking about 5% behind its first-quarter pace. Nek minute: Amazon’s shares dropped 2% below its pre-earnings announcement.
💡Earnings reports are financial documents that provide information about company performance over a given period. But these earnings track historical metrics...
💡So that means make investment decisions today based on historical performance of the company. Often this leads to information asymmetry between investors and companies.
💡Amazon was reporting on the strong performance of the first quarter of 2023.. but the more up-to-date info from the conference call meant investors were able to make more 'live' decisions.
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