Online retail giant and tech heavyweight Amazon is set to report Q1 earnings today after the close. 

Operating income and revenues estimates are near the upper end of the company's guidance, which tends to be conservative.

  • Amazon.com's expectations as of February 2, 2017 included: op income of $250-900 mln (no longer guides separately for stock-based compensation) vs ~$900 mln estimate; revs $33.25-35.75 bln vs $35.3 bln consensus. 

  • Incorporated into Q1 guidance: 250 bps negative FX impact and increased investments --primarily new FCs, AWS and digital content. Leap year last year also impacted results by ~ 150 basis points. 

Customer/Seller Growth Metrics

  • Prime/ Active AWS customers:  Prime subscriptions increased 51% y/y 2015, up 47% in the US and a higher rate than that internationally. 
  • Amazon Web Services - AWS and Cloud: Amazon has been breaking out this segment for a year now. The company does not provide specific guidance for the unit and estimates are still somewhat speculative based on the information the company provides.
    • Competitive pricing remains hot button issue as the battle continues with heavyweights like Microsoft's (MSFT) Azure. AMZN tends to skirt any specific comments regarding pricing going forward but any commentary/changes could create volatility for cloud names (listed below).

Logistics:

  • Delivery / shipping / fulfillment expansion: AMZN has been exploring options to reduce its dependency on USPS, United Parcel Service (UPS) and FedEx (FDX). Amazon continues to test air drone delivery, confirmed in January plans to operate its own air cargo hubs, rapidly expanding Amazon Logistics (hiring individuals/local companies to assist in delivery) and is now looking into autonomous driving delivery. 

TECHS:

Once again Amazon is facing extremely high expectations. Amazon shares have experienced a sell-the-news reaction to last two quarter's results. The stock is up 22% YTD and trading just shy of the all-time highs (923.72) reached earlier this month. 

That said, and even with lofty expectations, Amazon can always deliver (pun intended). The stock was off last quarter on slowing AWS growth and any "lever pull" by the company will launch it into orbit again. 

1000 "appears" to be a magnet for this stock.