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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?

Updated on 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.