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Amazon Earnings Live Updates: Wall Street Watching For Cloud Demand, Advertising Strength
Amazon CEO Andy Jassy
Reuters; SEBASTIEN BOZON/AFP via Getty Images; Chelsea Jia Feng/BI
- Amazon will release its fourth-quarter earnings after the closing bell on Thursday.
- Shares in the tech giant were up 8% year-to-date through Wednesday.
- Wall Street is bullish on the stock, and focused on ad-revenue growth and holiday sales.
Amazon will report fourth-quarter earnings on Thursday after the closing bell.
Analysts are upbeat about the firm's year-end performance. Strong holiday demand and ad-revenue growth are among the positive drivers.
The earnings-release time is shortly after 4 p.m. ET, and its conference call with analysts will start around 5 p.m.
Amazon's stock was up 8% year-to-date through Wednesday's close, outpacing the the S&P 500's 3% gain.
Morgan Stanley: Robotics are Amazon's key differentiator.
Morgan Stanley equity analyst Brian Nowak is bullish on Amazon over its latest advances in warehouse robotics, making it an underappreciated AI winner in retail. For every 10% of units passing through robotic-enabled warehouses by 2030, Amazon could unlock up to $3 billion in annual recurring savings.
"Early signals are promising too, with Amazon's latest fulfillment center in Shreveport, LA (opened in September 2024 as the first fulfillment center bringing together the full fleet of its latest robotics innovations), delivering 25% lower 'cost-to-serve' (fulfillment cost) during peak periods," Nowak wrote.
Fulfillment costs make up nearly 20% of retail revenue, he added, making automation a serious long-term positive
Morgan Stanley holds an "Overweight" rating on Amazon and a $280 price target, indicating 18% upside from current levels.
Bank of America: Looking for strength in cloud and AI demand.Amazon CEO Andy Jassy
Amazon
Amazon should deliver a solid fourth-quarter report, as holiday-boosted retail growth will deliver an above-consensus operating profit of $19.7 billion. The firm's AWS cloud platform will likely meet expectations for 19% to 20% growth, BofA said, thanks to rising AI contributions.
Drivers to cloud demand include, "Amazon's growing partnership with Anthropic, new competitive AI offerings (including Nova models and lower infrastructure costs on Trainium), and ramping GPU supply (greater Nvidia chip supply as well as the launch of Nvidia's Blackwell chips & cloud products)."
But there are risks moving forward. The bank lowered its first-quarter revenue amid tariff and currency headwinds and cited that AWS margins may have peaked in 2024 amid favorable demand.
BofA maintains a "Buy" rating on Amazon and a price objective of $255, or 8% above the firm's current share price.
Amazon's consensus fourth-quarter net sales estimate is $187.32 billion.
4th quarter
Net sales estimate: $187.32 billion
- Online stores net sales estimate: $74.71 billion
- Physical Stores net sales estimate: $5.4 billion
- Third-Party Seller Services net sales estimate: $48.02 billion
- Subscription Services net sales estimate: $11.58 billion
- AWS net sales estimate: $28.82 billion
- North America net sales estimate: $114.27 billion
- International net sales estimate: $44.13 billion
- Third-party seller services net sales excluding F/X estimate: +10.2%
- Subscription services net sales excluding F/X estimate: +10.3%
- Amazon Web Services net sales excluding F/X estimate: +19%
- EPS estimate: $1.50
Operating income estimate: $18.84 billion
- Operating margin estimate: 10.1%
- North America operating margin estimate: +6.48%
- International operating margin estimate: 3.08%
- Fulfillment expense estimate: $28.45 billion
- Seller unit mix estimate: 60.2%
1st quarter
- Net sales estimate: $158.64 billion
- Operating income estimate: $18.24 billion
(Source: Bloomberg data)
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