Revenue, along with revenue guidance for the current quarter, missed Wall Street's expectations — but investors still sent the world's top online retailer's stock up more than 10 per cent in after-hours trading.
"It boggles the mind," said BGC Financial analyst Colin Gillis, who attributed the stock price jump to slightly stronger-than-expected operating income. "A lot of people scratch their head at the valuation given to Amazon and the support the stock has."
Amazon.com Inc. said Tuesday that it earned $97 million, or 21 cents per share, in the October-December period. That's down from $177 million, or 38 cents per share, in the same period a year earlier.
Revenue for the crucial holiday quarter grew 22 per cent to $21.27 billion from $17.43 billion.
Analysts had expected earnings of 28 cents per share on revenue of $22.26 billion, according to a poll by FactSet.
Amazon said operating income increased 56 per cent to $405 million from $260 million in the fourth quarter of 2011.
"We're now seeing the transition we've been expecting," said Jeff Bezos, founder and CEO, in a statement. "After five years, eBooks is a multi-billion dollar category for us and growing fast — up approximately 70 per cent last year."
For the current quarter, Amazon expects revenue of $15 billion to $16.6 billion. Analysts had expected revenue of $16.86 billion.
The company has been investing a lot of its income into enhancing its distribution network and its Kindle business as part of a long term growth plan.
Seattle-based Amazon's shares rose $27.10, or 10.4 per cent, to $287.45 in after-hours trading. The stock had closed down $15.69, or 5.7 per cent, at $260.35.