Amazon predicted a weak quarter, and its predictions came true.
The retailer said Thursday that it swung to a quarterly loss for the first time in four years. The earnings report, issued after the market closed, immediately sent Amazon shares down 9 percent before recovering.
Amazon lost 60 cents a share in the third quarter, much of it because of a large loss on its investment in the daily deals site Living Social. The consensus estimate was a loss of 8 cents.
It was the first net income loss in 18 quarters. Amazon earned 14 cents a share in the third quarter of 2011.
The company had warned that a loss was coming, saying it expected to lose $50 million to $350 million in the quarter. Its operating loss was $28 million. Profit in the third quarter of 2011 was $79 million.
“Our approach is to work hard to charge less,” Jeff Bezos, founder and chief executive, said in a statement. “Sell devices near break-even and you can pack a lot of sophisticated hardware into a very low price point.”
Revenue was $13.8 billion, a little less than the $13.9 billion that analysts expected. Amazon had predicted that revenue would be $12.9 billion to $14.3 billion. In 2011, third-quarter revenue was $10.9 billion.
Amazon’s strategy of selling as cheaply as it can may be tough on its margins but is tougher on competitors. Radio Shack missed its earnings forecasts this week, prompting doubts about its viability. The specialty home appliance and electronics retailer h.h.gregg, which operates 200 stores in the Midwest and Southeast, saw its shares drop 13 percent Thursday. Best Buy fell 10 percent as it warned that third-quarter profit would be “significantly lower.”