Amazon's Financial Challenges Amid Tariffs

Amazon.com gave a weaker-than-expected forecast for operating profit in the current quarter, pointing toward tariffs and trade policies that may cause consumers to pull back on spending. The world’s largest online retailer projected operating profit of $13 billion to $17.5 billion, compared with an average estimate of $17.8 billion. Sales will be $159 billion to $164 billion in the period ending in June, the company said Thursday in a statement. Analysts, on average, expected $161.4 billion.

Amazon shares have fallen about 13% this year as Wall Street weighs the impact of President Donald Trump’s tariffs on a retail operation that sources much of its goods from China. Investors are generally bullish on the company’s efforts to become a major force in artificial intelligence, but there are concerns that Amazon’s prodigious spending on data centers may not translate into meaningful sales growth any time soon.

Amazon Web Services, the largest seller of rented computing power, reported first-quarter sales gained 17% to $29.3 billion, in line with analysts’ estimates. It was the unit’s slowest growth in a year.
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