Amazon warned that Donald Trump's global trade war had a weaker impact than expected in the second quarter, sending stakes in e-commerce giants.
In Thursday's financial guidance, the Seattle-based company added "tariff and trade policy" to a list of factors that pose a risk to its revenue risks.
Amazon said operating revenue for the quarter is expected to be between $13 billion and $17.5 billion, compared to $14.7 billion a year ago, but less than Wall Street's estimated $17.7 billion.
Analysts have warned in recent weeks that Amazon's profits could be under pressure from the Trump administration's decision to engage in a trade war with China, up to 145%.
Amazon has been negotiating huge discounts with suppliers and seeking wet tariff impacts. It imports about a quarter of its items from China.
Goldman Sachs analysts say taxes could make $5 billion from company operating profit this year before Amazon's results, depending on the performance of the trade war. That would be a $6-12% hit on Wall Street's forecast of $79.2 billion in business operating profit.
Amazon also forecasts net sales for the quarter of $159 billion to $16.4 billion, with a minimum of $161.4 billion under analyst expectations.
According to consensus estimates from S&P Alpha, the Seattle-based company's revenue grew 9% year-on-year to $15.6 billion, up from an estimated $1.55 billion.
The company's stock fell nearly 5% in after-hours trading ahead of the analyst call.
Amazon's huge e-commerce platform continued to grow in the first quarter. Net sales in its online retail division increased by about 5% from a year ago.
Amazon discussed import fees for consumer products this week on the U.S. government’s ultra-low-cost drag platform, similar to Chinese rival Temu.
From May 2, goods shipped from Chinese warehouses will be shipped, and the rule will be removed, which exempts items worth less than $800.
White House press secretary Karoline Leavitt said Tuesday the proposals were "hostile and political acts" by Amazon. "When the Biden administration lifted inflation to its highest levels in 40 years, why didn't Amazon do that?"
Trump later spoke with Amazon founder Jeff Bezos, and the company publicly backed off the proposal.
The company's cloud division, Amazon Web Services, almost ignored expectations, but continued to show signs of strong growth.
AWS, which operates data centers and provides software tools for customers, reported a 17% increase in sales to $29.3 billion, slightly below consensus estimate of $29.4 billion. The company's fast-growing advertising business grew 18% to $13.9 billion.
The company spent $24.3 billion in capital expenditure in the first quarter, up from $13.9 billion the previous year.
CEO Andy Jassy said earlier this year that the company plans to spend $1 billion in capital expenditure this year, with the vast majority of which spending goes to AI programs.