Below is the news release:

The earnings decline was far worse than Wall Street had expected from the e-commerce giant. That — along with a weak profitability forecast for the fourth quarter — sparked a sell-off in after-hours trading that pinched about 12% from the company’s stock, which had already slipped more than 4% in the regular session to close at $227.15. Colin Sebastian of Robert W. Baird said the fact that Amazon’s missed Wall Street’s earnings target is not new, but noted that revenue results also came in slightly below analysts’ forecasts — a change from previous quarters. “The lack of upside in revenue combined with guidance that looks pretty conservative is going to pressure the stock for the time being,” Sebastian said in an interview. For the period ended Sept. 30, Amazon AMZN -12.44% reported net income of $63 million, or 14 cents a share, compared to net income of $231 million, or 51 cents a share, for the same period the previous year. Click to Play Is Netflix now a buyout target? Netflix shares slid Tuesday and the stock price dipped to around $75 on the company's report of major subscriber losses. Is Netflix now an acquisition target? Rex Crum and Peter Kafka discuss on Digits. Revenue jumped 44% to $10.88 billion. Analysts were expecting earnings of 24 cents a share on revenue of $10.95 billion for the quarter, according to consensus forecasts from FactSet Research. The company reported operating income of $79 million for the quarter, a drop of 70% from last year’s third quarter and well below Wall Street’s forecast of $149.7 million. That put operating margin for the period at a relatively anemic 0.7%. Operating expenses jumped by 48% for the quarter. Amazon added about 8,100 workers during the quarter, which Sebastian noted as a significant growth in the company’s headcount, which now numbers 51,300 workers. “This fast pace of growth is costing Amazon a lot of money,” Sebastian said. “No one is going to really challenge Amazon, but the pace of their growth may be in question. In this environment, at this multiple, that’s not good enough.” The company said Tuesday that it is adding a total of 17 fulfillment centers this year, up two from its previously disclosed plan. Fulfillment expenses soared by 65% in the third quarter, with a 74% gain in expenses related to technology and content. For the fourth-quarter, Amazon projected a revenue range of $16.45 billion to $18.65 billion, compared to Wall Street’s forecast of $18.15 billion. “We don’t view these results as thesis-changing,” Citi analyst Mark Mahaney wrote in an email, noting that Amazon s spending “seems clearly elective/discretionary/offensive against very large market opportunities.” But he added that “we are surprised that the Q4 revenue guide isn’t more robust.” The profitability line for the fourth quarter is expected to come in between an operating loss of $200 million and operating earnings of $250 million, implying a targeted operating margin range of 1.3% at the top end of the forecast. Analysts had been expecting an operating margin of 2.7% for the period. Amazon is planning to launch its new Kindle Fire tablet in the middle of the fourth quarter. Analysts generally expect the device to boost sales, but its low price tag of $199 has some concerned that it may pressure margins even more during the crucial holiday period. Scott Devitt of Morgan Stanley says he currently expects Amazon to sell about 2.8 million units of the tablet in the fourth-quarter. “Short of material disruption of the business model in the seasonally strongest quarter of the year, we believe the guidance is light provided the sales impact of the Kindle Fire,” he wrote in a report Tuesday afternoon. (  Source: MarketWatch )