Amazon reports 77% decline in quarterly profit following season of major investments

Amazon.com Inc reported a 77 percent slump in quarterly profit as the company invests heavily in areas such as video content and in fast-growing economies such as India.

The company’s shares, already up nearly 41 percent this year, were down 2.6 percent at $1,019 in after-hours trading on Thursday.

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The shares touched a record high of $1,083.31 in regular trading, helping Chief Executive Jeff Bezos unseat fellow tech billionaire Bill Gates to become the world’s richest person, according to Forbes. Amazon said operating expenses rose 28.2 percent to $37.33 billion in the second quarter ended June 30.

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The company also forecast an operating income of $300 million to a loss of $400 million for the current quarter.

Analysts had expected operating income of $931 million, according to FactSet.

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Amazon is known for making bold investments in new business areas even at the expense of profits, a strategy that is often criticized by investors.

The world’s biggest online retailer said net income fell to $197 million, or 40 cents per share, from $857 million, or $1.78 per share, a year earlier.

Net sales rose 24.8 percent to $37.96 billion.

Amazon, which is in the process of buying upscale grocer Whole Foods Market Inc, also plans to create more than 130,000 full-time and part-time jobs by mid-2018 to speed up delivery.

Analysts had expected a profit of $1.42 per share and revenue of $37.18 billion, according to Thomson Reuters I/B/E/S.