Amazon Web Services grew by 46 per cent in the third quarter, but still failed to meet expectations, according to its latest results.
The company generated $6.68bn in the last three months, just shy of analysts’ estimates. Microsoft’s Azure division, meanwhile, saw revenue growth of 76 per cent over the same period.
Amazon CEO Jeff Bezos said the company’s business division was “adding customers rapidly, including large educational institutions, local governments, and more than half of the Fortune 100″.
But AWS growth is down quarter on quarter. In the second quarter of the year, the division reported 49 per cent growth, three per cent higher than in the last three months.
Amazon’s third quarter sales and forecasted holiday sales also failed to meet expectations, prompting the company’s stock to fall 9 per cent in premarket trading on Friday.
Commenting on the news, Barclays analyst Ross Sandler said: “We don’t see any real structural issue with Amazon but nearly every line in the business is decelerating a tad, and we typically see another deceleration in retail in 4Q, hence are struggling to identify a catalyst.”