Amazon AMZN saw its stock price dip roughly 1% during regular trading hours on Wednesday, just one day before the firm is scheduled to release its first-quarter fiscal 2019 financial results. Despite the slip, shares of Amazon have soared in 2019, along with Facebook FB , Netflix NFLX , and other tech powers.
So, let's see what to expect from Amazon's earnings and revenue results after the closing bell on Thursday.
Jeff Bezos' firm is set to see a significant top-line slowdown, with the law of large set to play its part. Nonetheless, Amazon is projected to see its share of the total U.S. e-commerce market reach 52.4% in 2019, up from 48% last year, according to eMarketer. Meanwhile, AWS grabbed approximately 32% of cloud market share last year, which helped it easily surpass second place Microsoft's MSFT 14%, along with IBM IBM , Google GOOGL , and Alibaba BABA .
Amazon is also reportedly set to expand its brick-and-mortar business beyond Whole Foods, bookstores, and its cashierless Amazon Go stores, to further challenge Walmart WMT , Target TGT , and Kroger KR . Plus, AMZN's digital advertising business is now the third-largest in the U.S. behind only Google and Facebook. Furthermore, Amazon Prime Video is a major player in the streaming TV market and looks poised to compete alongside Netflix NFLX , Hulu, and soon enough Disney DIS , AT&T T , and Apple AAPL , for years to come.
With all these growth opportunities in mind, shares of Amazon have popped roughly 28% in 2019. The e-commerce giant closed regular trading Wednesday at $1,901.75 a share, down roughly 7% off its 52-week high of $2,050.50.
Q1 Outlook & Earnings Trends
Amazon's Q1 revenue is projected to climb 16.95% to reach $59.69 billion, based on our current Zacks Consensus Estimate. As we touched on earlier, this would mark a slowdown from Q4's roughly 20% top-line expansion, which itself was down huge compared to Q3 2018's 29% climb, Q2's 39% surge, and Q1's 43% jump. In fact, the fourth quarter of 2018 was Amazon's smallest top-line expansion since 2015.
At the bottom end of the income statement, Amazon's adjusted Q1 earnings are expected to surge approximately 41% to reach $4.61 per share. AMZN's short-term earnings estimate revision activity has been mixed recently, with its 2020 estimate revision activity trending more positive. Investors should also note that the Seattle-based giant boasts a strong history o f quarterly earnings beats. This includes an 89% average surprise over the trailing four quarters.
Amazon is a Zacks Rank #2 (Buy) right now, based largely on its longer-term earnings estimate revisions. In the end, Wall Street and investors might focus on Amazon's AWS performance, along with any Prime and digital advertising updates Thursday, as massive top-line growth becomes harder to come by.
The company is set to release its first-quarter 2019 financial results after the closing bell on Thursday, April 25. Make sure to head back to Zacks after Amazon report s for a complete breakdown of the company's actual quarterly metrics.
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