Earnings Report Overview

Amazon (AMZN) is scheduled to announce its earnings for the first quarter this Thursday after the market closes. Analysts remain optimistic about the company’s performance, with many expecting both revenue and profits to increase.

Analyst Predictions

A recent review by Visible Alpha indicates that all 26 analysts monitoring Amazon have assigned a “buy” rating to the stock. Each analyst’s price target exceeds the stock’s current valuation, with an average target price of $243, reflecting a potential upside of approximately 29% from the latest close. This represents a decrease from last quarter’s target of $259.

Revenue and Earnings Expectations

For this quarter, Amazon is projected to report revenues of $154.96 billion, marking an 8% increase compared to the same period last year. Correspondingly, adjusted earnings per share are expected to rise from $1.46 last year to $1.74.

Market Challenges

Despite positive outlooks, Amazon’s stock has faced pressure this year, declining approximately 14% amid broader market challenges, particularly those related to tariff impacts that have affected major tech companies.

Concerns About Tariffs and AI Investments

Analysts will likely inquire about Amazon’s strategies regarding its artificial intelligence (AI) investments, especially in light of increasing competition. Additionally, significant attention will be directed toward the effects of tariffs imposed during the Trump administration.

A downgrade from Raymond James raised concerns that tariffs on products imported from China could adversely impact Amazon’s profit margins and the advertising revenue generated by sellers who depend on Chinese imports.

According to Morgan Stanley, about 18% of products available on Amazon are sourced from China, with nearly 60% of third-party sellers having some exposure that could influence their advertising expenditures.