Amazon.com, Inc. disappointed Wall Street Thursday with the company reporting fourth-quarter financial results that missed market expectations.

Net sales in the quarter increased 22 percent to $35.7 billion compared with $29.3 billion in fourth quarter 2014, with the company noting that the figure would have been $1.2 billion, or 26 percent higher had it not been for changes in foreign exchange rates.

Amazon’s operating income increased 88 percent to $1.1 billion in the fourth quarter versus $591 million in Q4 2014.

Net income came in at a record high of $482 million in the quarter, or $1.00 per diluted share, compared with net income of $214 million, or $0.45 per diluted share, in fourth quarter 2014, however analysts were predicting $1.56 per share.

For the full calendar year, Amazon says net sales were up 20 percent to $107 billion compared with $89 billion in 2014, but would have been up 26 percent if not for unfavorable exchange rates.

Yearly operating income came in a $2.2 billion, compared with operating income of $178 million in 2014, while net income for the full year came in at $596 million, or $1.25 per diluted share, compared with net loss of $241 million, or $0.52 per diluted share, in 2014.

“Twenty years ago, I was driving the packages to the post office myself and hoping we might one day afford a forklift. This year, we pass $100 billion in annual sales and serve 300 million customers,” Amazon Chief Executive Officer and Founder Jeff Bezos said in a statement. “And still, measured by the dynamism we see everywhere in the marketplace and by the ever-expanding opportunities we see to invent on behalf of customers, it feels every bit like Day 1.”

Cloud

The cloud still has a silver lining for Amazon with its Web Services division (AWS) generating $2.4 billion in net sales during the holiday quarter and operating income of $687 million, up from $1.4 billion in sales and $240 million in operating income in Q4 2014, and up from $2.1 billion in sales and $521 million in operating income during the third quarter of 2015.

For 2015 as a whole, AWS generated $7.9 billion in sales.

On an investor call, Amazon Chief Financial Officer Brian Olsavsky said that the company is “very happy” with the AWS business and that it approached a $10 billion run rate in Q4.

AWS is “growing faster on a dollar basis than in any year-over-year or quarter-over-quarter period…We feel like we have a lead in this space and we don’t take it for granted,” Olsavsky said. “We want to serve customers better each year.”

AWS’ operating margin for the quarter came in at 28.5 percent, and improvement over the quarter before and same quarter of last year, prompting Olsavsky to explain that Amazon has been looking at efficiency, and that  “There has been cost reduction in things we buy and utilization of the servers and data centers we have.”

Despite a record high profit and growing cloud market, Wall Street punished Amazon for missing its targets, driving AMZN stock down 13.43 percent to $550 per share in after-hours trading.

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