Amazon (AMZN) - Get Amazon.com Inc. Report shares dropped after hours Thursday after the company reported first quarter earnings that missed analyst estimates for the period. The company also said it expected to spend the entirety of its Q2 operating profit on coronavirus-related expenses.
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Amazon reported first quarter earnings of $5.01 per share on revenue of $75.5 billion, a 26% increase from the previous year. Analysts were expecting the company to report earnings of $6.25 per share on revenue of $73.61 billion.
Amazon shares dropped nearly 5% to $2,353 in after hours trading.
While earnings misses are not uncommon for the company, which often spends much of its earnings on internal infrastructure projects, the company said that its second quarter operating profit will be much lower than normal.
"Under normal circumstances, in this coming Q2, we’d expect to make some $4 billion or more in operating profit. But these aren’t normal circumstances. Instead, we expect to spend the entirety of that $4 billion, and perhaps a bit more, on COVID-related expenses getting products to customers and keeping employees safe," CEO Jeff Bezos said.
On Wednesday, Amazon also secured exclusive rights to stream a handful of NFL games for the next three seasons, signaling a new push into valuable sports streaming deals.
The new contract between the NFL and Amazon grants the latter exclusive rights to one additional Saturday game per year, which will stream on Twitch and Amazon Prime Video. There are about 118 million Prime members in the U.S, according to a recent estimate.
Amazon closed Thursday's session up nearly 3% and entered its earnings report up more than 30% year to date.