Amazon will report first quarter earnings after Thursday’s bell.
Here’s what Wall Street expects:
- I earn: $ 8.36 per share, according to Refinitiv
- Income: $ 116.3 billion, according to Refinitiv
Here are some other key revenue numbers:
- Amazon Web Services: $ 18.27 billion expected, according to StreetAccount
- Advertising: Expected $ 8.17 billion, according to StreetAccount
Amazon and Apple, which is also reporting results on Thursday, are the last in the Big Tech class to update investors on the start of the year. It has been a mixed bag so far, with ad-supported companies struggling in part due to macroeconomic conditions and the war in Ukraine.
Wednesday, Facebook parent A half exceeded expectations on earnings and daily active users, but they lost revenue and provided weak indications. One day before, Google lost on the top and bottom rows. Both companies said their advertising activities were impacted by issues such as inflation and increased competition.
Amazon started to reveal advertising revenue for the first time in its fourth quarter report, when it revealed a $ 31 billion annual online advertising business. Analysts expect 29% growth for the first quarter, a faster expansion than Facebook or Google in ad sales during the period.
Amazon’s total revenue is projected to have increased by 7.2%, which would mark the slowest rate in any quarter since the dot-com crash in 2001 and the second consecutive period of single-digit growth. Among other issues, the company is struggling with slowing e-commerce momentum with the reopening of brick-and-mortar stores.
Growth is expected to pick up in the second quarter, with analysts expecting an 11% expansion to $ 125.6 billion, according to Refinitiv.
In addition to ecommerce and advertising, Amazon’s findings will give an idea of how the company is addressing a number of economic challenges, including rising inflation, rising fuel and labor costs. , the growls of the global supply chain and the ongoing pandemic.
Amazon has worked to offset many of these costs. Earlier this month, it introduced a surcharge of 5%. for some of its US sellers, the first such commission in its history. And last quarter, Amazon increased the price of his US Prime membership for the first time in four years at $ 139 from $ 119.
Amazon still faces the specter of rising labor costs, especially after workers at one of its Staten Island warehouses voted in the company’s first US union earlier this month. Another election is underway at a second Staten Island warehouse, and work organizers have signaled interest in additional Amazon facilities. The company contested the union’s victory, arguing that the election results were tainted by interference from the union and the National Labor Relations Board.
Shares of Amazon have fallen roughly 14% so far this year, while the Nasdaq is down 18%. In 2021, Amazon was the Big Tech stocks with the worst performancesearning only 2.4%.
However, analysts like Wedbush Securities’ Michael Pachter remain bullish as consumers continue to rely on Amazon for so many commodities, including groceries.
“In the first quarter, we expect these products likely to have seen a price increase of around 5%, assuming the new 5% surcharge is implemented to offset the negative impact of inflation,” wrote Pachter, who recommends. buy the shares. a report last week. “Additionally, we believe inflation did not have a material impact on revenue in the first quarter due to robust consumer spending.”
Amazon’s cloud computing segment could continue to be brilliant for the company. Amazon Web Services revenue is likely up 36% from the previous year. cloud peers Microsoft and Google both exceeded analysts’ expectations for their cloud businesses earlier this week.
Investors also want the key to Amazon’s investment in the electric vehicle maker Rivianowhich produced an almost Earnings of 12 billion dollars in the fourth quarter following the holding of the company IPO and saw his stock prop. The stocks reversed dramatically this year, losing half their value as of March 31 and more since then.
on Wednesday, ford reported a loss of $ 5.4 billion on its 12% stake in Rivian. Amazon owns nearly 18% of the company, according to FactSet.
This story is developing. Check again for updates.