- Amazon is set to report earnings on August 1st; and overall, my projections call for $151 billion in revenues at group level, while consensus expects $149 billion.
- Amazon’s retail segment poised for double-digit growth, driven by strong consumer backdrop and Prime membership trends.
- On cloud, I argue that AWS has continued its strong March-quarter growth trajectory into Q2, driven by product releases and positive market sentiment towards cloud computing.
- AWS business shows strong commercial momentum with multi-billion dollar run-rate in AI/ML.
- I set my target price for Amazon ahead of Q2 reporting, and I see shares as undervalued below $200. “Buy”.
Amazon is scheduled to report earnings for the June quarter on August 1st, after the market closes. Looking ahead to the upcoming report, I argue that the company’s core retail business is well-positioned for continued growth: The company’s strategic focus on enhancing delivery speeds, expanding Prime membership, and leveraging its advertising platform is driving robust market share gains, while the overall market environment remains healthy, especially in its largest market, the U.S. On that note, I model $91-93 billion in sales for the North America segment and $33-34 billion for the international markets segment. Regarding Amazon’s cloud business, I believe AWS has maintained its strong growth trajectory from the March quarter into Q2, fueled by new product releases and positive market sentiment towards cloud computing. I expect AWS to report $26 billion in Q2 revenue. Consequently, my projections estimate $151 billion in total revenues for the group, compared to the consensus expectation of $149 billion.
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