Amazon.Com Inc, a technology giant that promotes e-commerce and cloud services around the world, released its second-quarter 2021 results after US stocks opened on Thursday, July 29th. Given that the company's competitors in e-commerce, digital advertising and cloud businesses are reporting good results, the market also has high expectations.

The stock fell 1.4% to 0.8%, losing $3600 to an one-week low.Although the company's total revenue exceeded $100 billion for three consecutive quarters, it fell below market expectations and fell 7% at one point in after-hours trading, falling $250 to break the $3400 round figure.

According to media statistics, all the 32 Wall Street analysts covering Amazon.Com Inc in the past three months were rated as "buy / increase", while no one rated "hold" or "sell". The average target price is close to $4333, which means there is still 20 per cent room for growth.

Amazon.Com Inc's share price has risen 92% since January last year, nearly three times the return of the broader s & p 500 over the same period. But it is up nearly 11 per cent so far this year, lagging behind the S & P's nearly 18 per cent gain, which hit an intraday high of $3773.08 in early July.

The year-on-year growth of revenue and EPS in the second quarter was significantly lower than that in the first quarter, and the guidance for the next quarter was not satisfactory.

According to the financial report, Amazon.Com Inc's net sales of total products and services in the second quarter were $113.08 billion, up 27.2% from a year earlier, below market expectations of $115.1 billion or a year-on-year increase of 29%. The company's official guidance was between $110 billion and $116 billion.

EPS earned $15.12 a share in the quarter, up nearly 47% from a year earlier and above market expectations of $12.30. But operating profit was $7.7 billion, up nearly 33% from a year earlier, below market expectations of $7.82 billion, and the company's official guidelines were $4.5 billion to $8 billion.

The analysis pointed out that this is the third consecutive quarter that Amazon.Com Inc's total revenue has broken through the $100 billion mark, but the year-on-year growth rates of revenue and EPS are significantly lower than the previous quarter, and it is also the first time in 11 quarters that the results have fallen below market expectations, triggering a decline in share prices in after-hours trading.

Revenue in the first quarter of this year rose 44% from a year earlier, surpassing Wall Street and company official guidelines, indicating that revenue growth in the second quarter was nearly halved from the previous quarter. EPS surged 215 per cent year-on-year to $15.79 in the first quarter, which means EPS actually fell more than 4 per cent in the second quarter from a month earlier.

At the same time, the company's guidance for the third quarter is not ideal. Net sales are expected to be $106 billion to $112 billion, equivalent to a year-on-year increase of 10% to 16%, halving the growth rate in the second quarter. Even the upper limit of the range is well below the Wall Street consensus estimate of $119.2 billion.Operating profit for the next quarter is expected to be between $2.5 billion and $6 billion, with the upper limit of the range also significantly lower than the $8.11 billion expected by Wall Street.

According to financial blog Zerohedge, the midpoint of the company's revenue guidance range for the third quarter was $109 billion, representing a year-on-year increase of 13.4%, which would be the slowest quarterly revenue growth in the past decade.

Other key data aspects:

Net sales of online stores in the second quarter were $53.16 billion, up nearly 16% from a year earlier and weaker than analysts' expectations of $56.71 billion. Zerohedge, a financial blog, said the growth rate was the slowest since 2019 and amounted to a "significant slowdown".

Net sales of AWS's cloud business were $14.81 billion, up 37% from a year earlier, faster than the 32% year-on-year growth in the previous quarter and higher than market expectations of $14.2 billion. But with a profit margin of 28.3 per cent, one of the lowest since the outbreak, it is feared that it has peaked.

Operating margins fell in the quarter, from a recent all-time high of 8.2 per cent to a "more mediocre" 6.8 per cent. Among them, the North American market and international retail profit margins have declined.

Free cash flow fell to $12.1 billion in the quarter, down 62% from a year earlier, or just over 30% of $31.9 billion in the same period last year.

By the end of the third quarter, Amazon.Com Inc had employed 1.335 million people worldwide, up 52 per cent from a year earlier. Zerohedge said the number of employees reached an all-time high after a slight decline in the first quarter.

The last financial report of "Bezos era" came to a bleak end.

The second quarter of this year was Amazon.Com Inc's first complete quarter during the period of economic reopening in Europe and the United States, and it was also the first year-on-year comparison with the "first quarter fully affected by the epidemic" in the same period last year. Investors pay close attention to whether the reversal of the home trend will have a negative impact on financial performance.

Amazon.Com Inc's revenue rose 40 per cent year-on-year in the second quarter of last year as global consumers flocked to online shopping in the wake of the COVID-19 outbreak. This makes the "base effect" encountered by Amazon.Com Inc in this financial report on the high side. The company's CFO Brian Olsavsky also stressed this point in a statement.

At the same time, the quarter marked the end of the Bezos era, when the founder handed over the post of chief executive to Andy Jassy, the former head of AWS, the cloud business.

In other words, the second quarter of the earnings period was Bezos's last quarter as CEO. Since the new richest man in the world doesn't usually attend quarterly earnings calls, the market expects the new boss, Jassy, to break this convention and fight in person.

Analysts note that Amazon.Com Inc's Prime Day membership promotion event scheduled for June this year will help boost second-quarter results. Last year, the membership day, which is usually held in July (third quarter), was postponed to October (fourth quarter) because of the epidemic.

People are also concerned about the growth of Amazon.Com Inc's AWS cloud business and the international expansion of Prime paid subscription members. In the second quarter, the company expanded its distribution network and member fast delivery services, strengthened its retail operations in countries such as India, Canada and Australia, made more AWS cloud services generally available, and released a new portfolio of streaming audio, video and smart home devices.

Like other American technology giants, Amazon.Com Inc faces a rapidly tightening regulatory environment in the future. The Federal Trade Commission (FTC) is investigating the company's plan to buy MGM, a famous Hollywood film production company, for $8.45 billion. Amazon.Com Inc publicly asked Lina Khan, the new chairman of FTC, to withdraw from the review on the grounds that the latter had expected to rule that the company had violated the anti-monopoly law.

Before the announcement of the results, Morgan Stanley believed that Amazon.Com Inc's share price could rise to as high as $5300 in the next 12 months (bull market scenario), on the grounds that its high-profit business could improve profitability while maintaining investment in new business, especially optimistic about Prime membership growth, digital transformation and cloud service adoption to the inflection point, as well as digital advertising as the next growth and profit engine and other key areas.

However, Evercore ISI is worried that Wall Street is too optimistic about its three-quarter report. after all, the Prime membership Day is completed ahead of schedule to the second quarter of this year, and better results in the second half of last year will continue to boost the base effect and make year-on-year comparisons more difficult. MKM Partners also said that as the US anti-epidemic unemployment benefit expires in September, doubts about the future of e-commerce have made Amazon.Com Inc's share price underperform Alphabet Inc-CL C and Facebook Inc this year.