Amazon is usually a retailer that operates at full volume, the noise of its sales growth a clarion call in an often muted retail sector.

However, this quarter that volume seems to have been turned down a couple of notches. While the latest Amazon results show impressive growth, and is a long way above the retail sector overall, by the high benchmark the company has set, the latest numbers have a certain softness. Revenue totalled US$43.7 billion, up 22 per cent year-on-year, below analysts’ expectations.

Some of the loss in momentum comes down to a more unfavorable exchange rate. On a constant currency basis, Amazon’s overall growth is a more respectable 24 per cent; while its international growth leaps to 23 per cent from 18 per cent, once the impact of the strong dollar is factored out. Even so, these upticks still leave a gap in growth compared to what Amazon delivered over the first three quarters of the fiscal.

Part of the softness comes down to shipping-related revenue, which grew by its slowest pace in over a year. This has placed a little downward pressure on the revenue line. More worryingly it means that shipping revenue from consumers is now strongly adrift from Amazon’s shipping costs. In the final quarter, the former grew by 29 per cent, while the latter surged by 35 per cent to just over $5.6 billion. This is one of the reasons the company missed its profit forecasts, and why operating profit came in at 2.9 per cent of sales versus 3.1 per cent over the same period last year.

Arguably, low cost and fast delivery are a fundamental part of Amazon’s appeal to consumers. However, they are also its Achilles’ heel – and with Prime becoming more popular, and with a greater focus being put on speedier shipping times, we have concerns that Amazon could see further profit erosion as it enters its new fiscal year. This view is supported by Amazon’s own guidance for the next quarter, which suggests profit will come in well below last year.

As niggling as these points are, they do not diminish Amazon’s success in other areas. Over the holiday quarter, the company saw demand for its devices, including the Echo product, boom. This helped Amazon to a very strong performance in electricals at a time when the overall market was struggling with a lack of newness and innovation. It also aids Amazon to extend its ecosystem to more households, something we believe will yield fruit over the coming years as it becomes a more integrated and critical part of people’s lives.

The AWS (Amazon Web Services) division is also a success story. Here revenue grew by 47 per cent off the back of a very strong prior year comparative. This part of the business is helpful as its relatively strong profitability gives buoyancy to Amazon’s balance sheet.

As much as this quarter has been more subdued, Amazon remains firmly on the front foot in terms of innovation. This alone will continue to make it a retail outperformer, at least in sales terms, over the next year and beyond.

• Anthony Riva is an analyst with GlobalData Retail.