Amazon has recorded its first loss since 2015 - leading to a near-9% dive in the e-commerce giant's share price in after-hours trading last night.
Online sales at the US group also slipped 3% in the first three months of the year, as the boom to its business from the pandemic starts to fade.
Growth in other parts of its operations, including cloud computing and advertising, remained strong. But it is wrestling with the impact of rising costs and the Ukraine war.
Overall, Amazon reported a loss of just over £3billion - much of which was driven by a hit from its investment in electric carmaker Rivian.
It forecast sales growth of as little as 3% in the coming months - a marked slowdown.
The BBC reports that Amazon chief executive Andy Jassy said: "The pandemic and subsequent war in Ukraine have brought unusual growth and challenges."
He added that the company was also facing increased costs, with "ongoing inflationary and supply chain pressures".
The firm's overall sales continued to rise, up 7% year-on-year to £93billion, powered by Amazon Web Services (AWS) - the company's cloud-computing division. Its revenues were up 37% year-on-year, while advertising revenue was also strong, rising 23%.
But, elsewhere, growth showed marked slowdown - especially in its international business, where sales sank 6%.
Expenses are also rising rapidly. Inflation added £1.6billion in expense in the quarter, while costs more within the firm's control also hurt, executives said.
The company has increased wages to attract staff in the face of labour shortages and is also facing a widening unionising drive in the US.
Meanwhile, higher fuel prices have made delivery costs more expensive for the online retailer.
It comes after Amazon said it was raising the price of its Prime service, which gives subscribers access to benefits like faster shipping, for US customers - citing increased wage and shipping costs.
Also in the US yesterday, there were strong quarterly results from Apple - but this was not enough to prevent its shares dipping by more than 2% in after-hours trading.
The iPhone maker said sales rose 9% year-on-year, to £78billion, while profits climbed more than 10% to £20billion.
However, executives struck a less-optimistic tone in a call with analysts to discuss the results, describing success despite a "challenging macroeconomic environment".
"We are not immune to these challenges, but we have great confidence in our teams, in our products and service and in our strategy," chief executive Tim Cook said.
CV19-related shutdowns in China and chip shortages are limiting the firm's ability to meet demand for its products.
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The UK’s top share index, the FTSE 100, was up 36 points at 7,545 shortly after trading opened this morning, following its 83-point rise yesterday.
Brent crude futures were ahead by 0.20% at $107.80 a barrel.
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