Amazon Walking Tall


The Amazon news is striking on so many levels: Like Apple, expectations were high; like Apple, the pressure was on; like Apple , this company was expected to perform well even in the face of severe financial meltdowns around the world.

And the company delivered, delivered, delivered.

Amazon beat the Street by a dime a share, posting 41 cents against the 31 cents expected. Operating income came in at $244 million, on almost $4.9 billion in revenue. The topline beat estimates by more than $150 million.

At the same time, North American revenue grew 21 percent when some on the Street were looking for 13 to 16 percent.

Margin expansion appears to be happening far steeper and far quicker than analysts were anticipating. Still, Amazon shares took a hit when these numbers were released, but as soon as investors, analysts and media (like me) had a chance to absorb these margin expectations, shares quickly turned positive. Like Apple, Amazon normally offers fairly conservative guidance, and did so once again tonight, offering a revenue range of $4.3 billion and $4.79 billion, with the Street consensus at $4.609 billion. Operating income should be in the range of $110 million to $190 million, but that includes $90 million in stock-based compensation charges. Add that back in and you're talking about a range of $200 million to $280 million, or essentially inline with the $250 million Wall Street was projecting.

I spoke to one analyst who told me it stands to reason that if Amazon came in at the high end of the range this time around, there's a good chance for a repeat performance next quarter.

You gotta hand it Citi's Mark Mahaney. He made this call on Monday and was on our program "Fast Money" making sure everyone knew this was a call for the long term, not necessarily something about this quarter in particular. Well, Mark, you done good. Next quarter, this quarter. No matter. You stuck your neck out, and now you and your clients can sit back and enjoy the pay off.

Meantime, Amazon continues to extend its rally, ala Apple, on this earnings news, and like Apple, Amazon's up better than 40 percent since the beginning of the year.

Questions? Comments?