Amazon CEO Andy Jassy speaks at the Bloomberg Technology Summit in San Francisco on June 8, 2022.
David Paul Morris | Bloomberg | Getty Images
Amazon is slated to report fourth-quarter earnings Thursday after the market close.
Here’s what analysts are expecting:
- Earnings: $1.49 per share expected, according to LSEG
- Revenue: $187.3 billion expected, according to LSEG
Wall Street is also watching several other numbers in the report:
- Amazon Web Services: $28.8 billion, according to StreetAccount
- Advertising: $17.4 billion, according to StreetAccount
Analysts are projecting revenue growth of roughly 10% during the quarter, which includes results from the holiday shopping season. Online spending jumped nearly 9% to $241.1 billion in November and December, according to data from Adobe Analytics, which tracks sales on retailers’ websites. That was slightly higher than analysts’ forecast for sales of $240.8 billion.
Operating income during the fourth quarter is expected to grow 44% year over year to roughly $19 billion, according to FactSet estimates.
The company’s bottom line has benefited from CEO Andy Jassy’s cost-cutting campaign, which has been ongoing since late 2022. The company laid off more than 27,000 employees in 2022 and 2023, and it’s had smaller rounds of job cuts in 2024 that have stretched into this year. Amazon has also continued to wind down some of its more experimental and unprofitable initiatives.
Amazon rounds out a busy earnings period for the top tech companies. Google parent Alphabet on Tuesday posted disappointing fourth-quarter revenue. Apple, Meta and Microsoft reported results last week.
Wall Street will be looking for any commentary from Amazon about the impact of President Donald Trump’s recently announced tariffs on its business. Tariffs on Canada and Mexico are now on hold for one month, while the import taxes remain in place for China.
The company has long connected Chinese manufacturers to American shoppers through its sprawling third-party marketplace. By some estimates, China-based merchants outnumber American sellers on the platform, according to data from Marketplace Pulse.
Amazon’s first-party retail business has the highest exposure to Trump’s tariffs on Chinese imports among the e-commerce companies it tracks, analysts at Morgan Stanley wrote in a Monday note. The analysts estimate that 25% of products sold by Amazon’s first-party retail business come direct from China.
Over the years, Amazon has moved away from first-party sales to third-party sellers, which now account for 60% of products sold on the site.
During the fourth quarter, Amazon launched its competitor to Temu and Shein, called Haul, which offers low-cost apparel, jewelry, electronics and other items. Trump’s tariffs also took aim at the “de minimis” trade exemption that has allowed direct-from-China services like Amazon Haul to bypass duties and taxes on packages worth less than $800. Prices on Amazon Haul could rise as a result of Trump shutting the de minimis loophole.
The company’s investments in artificial intelligence are also likely to be an area of focus.
Amazon planned to spend about $75 billion on capex in 2024, Jassy said last quarter, adding that he suspected the company would spend more in 2025. The jump in spending is primarily being driven by AI investments, Jassy said.
An AI model created by Chinese startup DeepSeek has captured headlines and roiled markets in recent weeks. DeepSeek claims it only took two months and less than $6 million to develop its R1 model, which it says rivals OpenAI’s o1. The announcement caught Wall Street and Silicon Valley by surprise, challenging the assumption that tech companies must spend heavily on chips and data centers in order to build cutting-edge AI models.
Amazon has been racing to release new AI products and features as it looks to keep up with its competitors. The company in December launched a new set of AI models, called Nova. The company also offers Bedrock, which lets users access AI models from Amazon and others, and an AI chatbot for shopping called Rufus.
The company is expected to release an updated version of its Alexa digital assistant with AI features. It first previewed the redesigned Alexa in 2023, though the rollout has reportedly been slowed by technical challenges, according to Bloomberg. In October, Jassy said the new Alexa could launch “in the near future.”
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