Amazon shares fell more than 10% in after-hours trading on April 28, 2022, after the company reported first-quarter results and issued a weaker-than-expected outlook for the next quarter. The results showed slowing revenue growth and a sharp drop in operating income, while management described inflation, freight, fuel and fulfillment-network costs as pressures on the business. A separate $7.6 billion valuation loss on Amazon’s Rivian investment drove the reported net loss, but it was not an operating expense.
What Amazon reported for Q1 2022
Amazon announced results on April 28, 2022, for the quarter ended March 31. Revenue grew, but profitability from operations fell substantially year over year.
| Measure | Q1 2022 | Comparison |
|---|---|---|
| Net sales | $116.4 billion | Up 7% year over year |
| Operating income | $3.7 billion | Down from $8.9 billion in Q1 2021 |
| Net income (loss) | -$3.8 billion, or -$7.56 per diluted share | Included a $7.6 billion pretax valuation loss on Amazon’s Rivian common-stock investment |
These figures are from Amazon’s April 28, 2022 results release. The distinction between operating income and net income matters: operating income reflects the results of the business’s operations, while the Rivian investment valuation loss was a non-operating item that contributed to the net loss.
Why shares dropped after the announcement
GeekWire reported that Amazon shares fell more than 10% in after-hours trading following the release. The report pointed to the Q2 sales forecast, which came in below expectations, as well as the quarter’s cost pressures and weaker operating performance. This is contemporaneous reporting on the market reaction, not proof that any single factor caused the stock move.
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The results presented investors with a combination of slower growth and reduced operating income. Amazon’s revenue was still higher than a year earlier, but operating income had fallen by more than half. The outlook also suggested that the pressure on profits could continue into the next quarter.
How inflation and supply-chain pressure affected costs
CEO Andy Jassy described the period as unusually challenging, saying: “The pandemic and subsequent war in Ukraine have brought unusual growth and challenges,” in Amazon’s April 28, 2022 release. He also cited ongoing inflationary and supply-chain pressures and said the company was working on productivity and cost efficiencies after rapidly expanding its fulfillment network.
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GeekWire reported that Amazon cited $2 billion in incremental costs compared with the year-earlier quarter due to inflationary pressures. It also reported CFO Brian Olsavsky’s comparison that overseas container shipping costs had more than doubled from pre-pandemic rates and fuel cost 1.5 times as much as a year earlier. Those figures describe the cost environment discussed in 2022; they are not current cost estimates.
Jassy’s release also connected efficiency efforts with delivery performance. He said the company saw progress in customer experience, including delivery speed, while noting that easing inflation and supply-chain pressures could take time. The statement reflects management’s view at the time, not a guarantee about the pace or outcome of improvement.
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What Amazon forecast for Q2 2022
Amazon’s Q2 outlook, as reported by GeekWire on April 28, 2022, was materially wide on operating income:
| Q2 2022 forecast | Range |
|---|---|
| Sales | $116 billion to $121 billion |
| Operating income | A loss of $1 billion to income of $3 billion |
The forecast was guidance for the quarter following Q1 2022, not a current projection. Its operating-income range—from a loss to a profit—underscored the uncertainty around costs and execution at the time.
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How to interpret the headline
Inflation and supply-chain costs were part of Amazon’s explanation for pressure on expenses, but the available reporting does not establish inflation alone as the cause of the share decline. Investors were reacting to the full earnings picture: revenue growth of 7%, operating income falling from $8.9 billion to $3.7 billion, a net loss that included the Rivian valuation mark-down, and a Q2 forecast below expectations.
GeekWire’s contemporaneous account of the after-hours move and cost commentary is available in its April 28, 2022 report. The event is best understood as a historical response to results and outlook, rather than as a standalone measurement of how inflation affects Amazon shares.
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