Wall Street expects another huge jump in Amazon's revenue, albeit at lower profits, compared with last year, when the company reports its first-quarter earnings on Thursday.
But the conference call after the announcement could prove just as interesting to investors, if it provides a peek into Amazon's plans for political damage control, dominance in cloud computing and investments in voice-assistant Alexa.
The e-commerce giant is estimated to post first-quarter profit of $1.26 per share, down from the $1.48 per share reported a year ago, according to a Thomson Reuters consensus estimate.
Revenue is expected to be $49.79 billion, up 39 percent from last year's $35.71 billion. Amazon gave revenue guidance in the range of $47.75 billion to $50.75 billion.
Key issues that are likely to be discussed during the company's earnings call: reactions to the president's anti-Amazon salvos, insight into whether Amazon Web Services can double revenue by 2020 and how much Amazon is willing to spend on Alexa.
Trump's attacks
President Donald Trump has escalated his attacks on Amazon over the past month, causing the company's stock to drop by as much as 13 percent in that span. Amazon hasn't responded to any of those criticisms yet, but investors may want answers on how to view those threats, especially around the sales tax and post office issues.
"While we consider it highly unlikely that management would directly comment on [Trump's] accusations in its prepared remarks, we do believe it may answer questions from our peers on the call regarding one or more of the topics mentioned by the President," said D.A. Davidson analyst Tom Forte.
AWS growth
AWS continues to be the main growth driver for Amazon. The cloud service is now at a $20 billion revenue run rate, but is expected to grow another 44 percent this quarter to $5.3 billion in revenue. Keybanc Capital Markets analyst Edward Yruma recently wrote in a note that AWS is estimated to double its revenue to $41 billion by 2020.
"We believe AWS remains in the early stages of growth, with its cloud computing dominance (~$20bn revenue run rate; 44% market share) and strong profitability set to continue," Guggenheim Securities' Robert Drbul wrote in a note this week.
Future investments
Amazon's investment in its business will continue to weigh on its profitability. The company said it would "double down" on growing its voice-assistant technology Alexa last quarter, while it's been expanding its logistic network and international footprint. Investors believe these investments will help grow Amazon's core retail business, as well as its Prime membership program, which the company disclosed last week for the first time had exceeded 100 million worldwide.
New growth areas
Amazon is also focused on growing a number of new business segments, including its business marketplace (Amazon Business), advertising, and hardware devices (Echo, Kindle, etc). These are smaller than other parts of the business, but investors may want more clues on how to assess their value.
"We also see meaningful upside in key areas such as Amazon Business, advertising, and devices, which we believe are all in the very early stages of development," Stifel's Scott Devitt wrote in a note.