Amazon (AMZN) is set to report Q1 results today with a call at 5:30pm ET.
The CapitalIQ consensus estimate for non-GAAP EPS is $6.32 and for revenue it's $74.09 bln.
Operating income is a metric that's closely watched.
This should be an interesting quarter for AMZN as they were the main beneficiary of the mega cap tech names during the pandemic. The “negative” is that company has had to hire thousands of workers to keep up with demand. This could hurt profits.
Its Amazon Fresh grocery delivery service is currently free to Prime members, so the numbers there will be key to watch as well as the pandemic has led to a wave of at-home grocery shopping.
The other key segment in this report will be AMZN's highly profitable Amazon Web Services (AWS) cloud computing offering. AWS also generates higher top line growth, although it is a lot smaller, so that would be expected.
TECHS:
Amazon has been on fire, up more than 40% since mid-March as investors piled in with the belief that AMZN's business is booming with all the shelter in place ordinances.
RESULTS:
Amazon misses by $1.22, beats on revs; guides Q2 revs in-line, Q2 operating income guidance below consensus
Reports Q1 (Mar) earnings of $5.01 per share, $1.22 worse than the S&P Capital IQ Consensus of $6.23; revenues rose 26.4% year/year to $75.45 bln vs the $74.15 bln S&P Capital IQ Consensus.
Operating income was $3.99 bln vs current consensus of $4.06 bln; AMZN has previously guided to $3.0-4.2 bln.
AWS segment revenue rose 33% yr/yr to $10.22 bln.
Co issues in-line guidance for Q2, sees Q2 revs of $75.00-81.00 bln vs. $78.86 bln S&P Capital IQ Consensus. Guides to Q2 operating income of $(1.5)-1.5 bln vs consensus of $3.73 bln.
"Under normal circumstances, in this coming Q2, we'd expect to make some $4 billion or more in operating profit. But these aren't normal circumstances. Instead, we expect to spend the entirety of that $4 billion, and perhaps a bit more, on COVID-related expenses getting products to customers and keeping employees safe."
"In March, we increased pay for hourly employees by $2/hour in the U.S. and Canada, £2/hour in the U.K., and €2/hour in many European countries. We also doubled the regular hourly base pay for overtime hours worked — a minimum of $34 an hour in the U.S. — an increase from time and a half. Our investment in increased pay for our hourly employees and partners during COVID-19 will be nearly $700 million through May 16."
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