What To Expect From Amazon’s Q4 Earnings

Amazon‘s (NASDAQ:AMZN) Q4 earnings release on January 31 will be eagerly watched to understand the company’s standing in international markets, as well as the performance in the cloud market in the context of claims made by Oracle. We expect Amazon to continue growing profitable across all segments, except the International business due to competitive pressures.

We currently have a price estimate of $1,600 per share for Amazon, which is about in line with the current market price. Our interactive dashboard on Amazon’s Price Estimate outlines our forecasts and estimates for the company. You can modify any of the key drivers to visualize the impact of changes on its valuation.

During its analyst day in October last year, Oracle made some major claims about the value proposition and consequent traction of Oracle’s cloud versus AWS. While Amazon’s management may not directly respond to specific competitive questions, the company’s view on traction and its growth outlook is likely to shed some light on market developments. Additionally, with the IBM and Red Hat deal, Amazon’s position in the hybrid cloud market will be another area of interest.

On the retail side, Amazon’s performance in the U.S. in the backdrop of rising interest rates (especially during the holiday season) could point towards the larger trend of U.S. growth. While internationally, Europe is likely to be stable, India should be a hot topic due to the country’s recent rulings which earlier had barred private label goods only to be reversed within a week. Also, competition from Flipkart (owned by Walmart) is likely to have dented margins.

Entering 2019, while Amazon may have some good news on its devices business, the plan for the bigger businesses will be the key for the stock price.

Do not agree with our forecast? Create your own price forecast for Amazon by changing the base inputs (blue dots) on our interactive dashboard.