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Amazon sets earnings report after disappointing Big Tech report


Amazon (AMZN) is set to report third-quarter earnings after markets close on Thursday.

Here’s what Wall Street predicts from the e-commerce giant, according to Bloomberg:

Turnover: $127.63 billion expected versus $110.8 billion in Q3 2021

Adjusted earnings per share (EPS): $0.45 expected vs $6.12 in Q3 2021 (after 20-for-1 stock split)

Amazon Web Services (AWS) Net Sales: $21.01 billion expected versus $16.11 billion in Q3 2021

There are places where Amazon could be set to win, demonstrating its resilience in a tech trend and volatile macroeconomic environment.

First, the Prime Day sales events of the past few months are important and can lead to increased sales online and for third-party sellers. The July Prime Day Event is Amazon’s The biggest unprecedented in terms of purchases, with Prime members purchasing more than 300 million items globally. The company did not disclose revenue figures from the event.

Amazon led to a 13% to 17% increase in sales in the third quarter, and analysts believe the company looks set to meet those numbers. Looking ahead, JP Morgan analyst Doug Anmuth also said Amazon’s retail business is poised to beat competitors this holiday season.

An Amazon delivery worker checks packages in New York City, U.S., July 11, 2022. REUTERS / Brendan McDermid

An Amazon delivery worker checks packages in New York City, U.S., July 11, 2022. REUTERS / Brendan McDermid

“The retail industry’s top concerns are largely driven by the macro and how well Amazon will hold up in a recessionary environment,” he wrote in an October 26 note. “In the short term, we are. We think higher inventory levels and faster delivery speeds will be key drivers as Prime returns to normal, and we expect Amazon to have an inventory edge this holiday season as multi-retailers channels may be more constrained by physical space.”

AWS may also be willing to report growth at or around 30%, due to moderately compressed operating margins. There is a reason to pause here, because competitor Microsoft (MSFT) has seen its cloud sales grow slow down. But there’s still a lot of optimism for AWS. For example, Raymond James analyst Aaron Kessler expects “continued leadership and momentum in the cloud .” [and] AWS,” he wrote in an October 25 note.

So there could be good news for Amazon when it reports third-quarter earnings. However, it’s impossible to forget the extent to which this environment, from a hawkish Fed to the specter of a recession, has rattled Big Tech. .

Wedbush analyst Dan Ives wrote earlier this month: “Concerns about the relationship between the Q3 earnings season and negative revisions have pushed tech stocks lower.” “Any positive news is negative news … in this market, and bad news is considered Armageddon and therefore knocks tech stocks in a split second.”

Big Tech’s tough week

It’s been a rough time for Big Tech – even before this week – and Amazon is no exception. This week, we saw the consequences of inflation choking consumer spending. Google Owner Alphabet (GOOG, GOOGLE) saw its stock drop after YouTube ad revenue come shortwhile Meta (META) and stocks back slide Its earnings missed on Wednesday.

Amazon is far from avoiding a consumer downturn. This month, the company’s second Prime event reported as non-stackable, according to both CNBC and Luck. This month, Bank of America analysts estimate that Amazon took in $5.7 billion from its Prime Early Access Sale in October, down from the $7.5 billion it estimated. for Amazon’s July Prime event.

Amazon stock is down about 29% as of Wednesday’s market close.

Allie Garfinkle is a Senior Technology Correspondent at Yahoo Finance. Follow her on Twitter at @agarfinks.

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