Shares of e-commerce giant Amazon (AMZN) slipped in after-hours trading after the firm reported mixed Q2 results. Earnings per share came in at $1.26, which beat analysts’ consensus estimate of $1.03 per share. Sales increased by 10.2% year-over-year, with revenue hitting $148 billion. This missed analysts’ expectations of $148.8 billion.
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The various segments of the company witnessed notable growth over the past year. North America’s sales climbed to $90 billion, which was a 9% increase from the previous year. In the International segment, sales reached $31.7 billion, a year-over-year growth of 7%. Additionally, the AWS segment experienced a 19% increase in sales, which equaled a total of $26.3 billion.
Interestingly, a quick look at Amazon’s website traffic would have predicted its year-over-year growth. In fact, website traffic in Q2 2024 outperformed the comparison period from 2023 (the grey line).
Looking forward, management now expects revenue and operating income for Q3 2024 to be in the ranges of $154 billion to $158.5 billion and $11.5 billion to $15 billion, respectively. For reference, analysts were expecting $158.3 billion in revenue. Therefore, the guidance is considered soft due to a revenue midpoint of $156.25 billion.
Is Amazon a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Strong Buy consensus rating on AMZN stock based on 34 Buys assigned in the past three months, as indicated by the graphic below. After a 44% rally in its share price over the past year, the average AMZN price target of $225.88 per share implies 22.19% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.
