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Amazon Spooks Investors With Big Spending Ahead of Holidays

  • Online retailer reduces profits to make movies and gadgets
  • Warehouse expansion drives up expenses, gobbles sales growth
Bloomberg business news

How Important Is Prime to Amazon's Holiday Sales?

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Amazon.com Inc. reminded investors it’s still willing to spend lavishly on products or areas that could be the next big thing -- whether video streaming, automated personal assistants or a toehold in emerging markets -- even if it means thinner profit margins and a weaker stock price.

Amazon reported third-quarter earnings Thursday that missed analysts estimates on increased spending and forecast that it might not make a dime on holiday sales expected to top $40 billion. The world’s biggest online retailer will continue to win market share by offering quick delivery of an ever-growing assortment of goods. And it will continue to spend on the things that make its customers loyal: warehouses near their homes, original video shows to watch and devices that make their lives easier.