NEW YORK (AP) — Amazon offered a cautious sales outlook for the current fourth quarter that encompasses the critical holiday shopping period after delivering fiscal third-quarter results that came in below Wall Street analysts' expectations.

The Seattle-based tech giant, however, posted strong sales growth in its prominent cloud computing unit. Sales in its so-called Amazon Web Services rose 39.3% during the latest quarter ended Sept. 30, higher than the 37% clip in the previous quarter. It marked the fastest growth rate in nearly five years, the company said.

Still, shares were down more than 5% in after-market trading when the results were released as investors focused on the core business.

Analysts will be looking for any comments from Amazon executives on the earnings call Thursday about the holiday shopping season. The tech giant said earlier this month that it would hire 300,000 U.S. seasonal workers for the shopping period. That’s up from 250,000 last year.

Investors also have been closely watching Amazon’s quarterly earnings to see if the company’s big spending on artificial intelligence is starting to pay off.

CEO and President Andy Jassy disclosed to investors in July that it now expects capital spending, mostly in artificial intelligence, to total $220 billion. That number includes outlays on robots, semiconductors and satellites. That’s up from the $200 billion investment plan that was announced in February and well above the $128 billion in capital spending for all of last year. Jassy had cited the higher cost of memory chips as the main reason for the increase.

Jassy told investors this past summer that even at the $220 billion level, Amazon will not have enough capacity to meet all of the demand it has this year.

The latest earnings report from Alphabet late Wednesday raised alarm bells when it reported weaker growth for the summer than analysts expected. The company behind Google and YouTube also said it burned through more cash during the latest quarter, according to a measure called free cash flow, after its purchases of property and equipment topped $51 billion. Its stock plummeted Thursday.

Such worries are weighing on the entire AI industry following a big push to build data centers and fill them with AI chips.

Amazon reported net income of $20.69 billion, or $1.89 per share, in the three-month period. That compares with $21.19 billion, or $1.95 per share, in the year-ago period.

Net sales rose 12% to $201.94 billion, compared with the same year-ago period's $180.17 billion. Amazon said that sales were hurt by the shift in the calendar for the company’s big sales event Prime Day, which fell in the second quarter this year for most large countries. In 2025, Prime Day occurred entirely during the fiscal third quarter.

Excluding this shift, third quarter year-over-year sales growth would have been approximately 400 basis points, or 4%, higher, Amazon said.

Analysts were expecting $1.97 per share on sales of $202.2 billion, according to FactSet.

For the fourth quarter, Amazon said it expects net sales to be between $240 billion and $247 billion, which translates to a 12% to 16% increase compared with the year-ago period. Analysts were expecting $244.16 billion.