Amazon soars after huge earnings beat

Earnings

Jeff Bezos

Matthew Staver | Bloomberg | Getty Images

Amazon is set to report fourth-quarter earnings after Thursday’s closing bell.

Here are the key numbers:

  • Earnings per share: $4.03 per share, according to analysts surveyed by Refinitiv
  • Revenue: $86.02 billion, per Refinitiv
  • Amazon Web Services: $9.81 billion, according to FactSet

Amazon is expected to see a dip in fourth-quarter profits compared to a year ago, as a result of growing investments in one-day delivery. In its last earnings report in October, the company said it would spend $1.5 billion over the holiday shopping period to make one-day delivery the standard for Prime subscribers.

The company issued disappointing revenue guidance in its third-quarter results, which sparked fears of a potentially underwhelming holiday shopping season. But the heavy investment cycle seems to be paying off, however. Last month, Amazon claimed customers shopped at record levels during the holiday season and said it quadrupled both one-day and same-day deliveries over the period.

Wall Street now expects fourth-quarter revenue to come in at $86 billion, which is at the high-end of Amazon’s guidance of $80 billion to $86.5 billion that it gave when it reported earnings last fall.

Amazon Web Services (AWS) continues to be the company’s primary profit driver, but revenue growth has slowed in recent months. Analysts expect AWS revenue to climb 28% to $9.81 billion from $7.43 billion a year earlier. That would be an even further deceleration than the third quarter, when AWS reported 35% revenue growth, which was the lowest growth rate in more than five years.

AWS continues to be the market leader in cloud-computing services, but it faces rising competition from Microsoft‘s Azure. In its fiscal second-quarter results on Wednesday, Microsoft said Azure revenue grew 62%, which was higher than what some analysts expected.

This is breaking news. Check back for updates.

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