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Oct. 24, 2019, 3:32 p.m. EDT

Amazon earnings preview: One-day shipping and AWS slowdown could squeeze results

Amazon shares have fallen more than 9% over the past three months

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By Tonya Garcia, MarketWatch

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Here’s what to look for in Amazon’s earnings:

Earnings: FactSet expects earnings per share of $4.59, down from $5.75 last year.

Estimize, which crowdsources estimates from sell-side and buy-side analysts, hedge-fund managers, executives, academics and others, expects per-share earnings of $4.85.

Amazon missed the FactSet earnings estimate in the last quarter, but beat expectations the previous seven quarters.

Revenue: FactSet is guiding for revenue of $68.83 billion, up from $56.58 billion last year.

Estimize has a forecast for $69.16 billion in revenue.

Amazon beat the FactSet revenue estimate the past three quarters.

Stock price: Amazon shares have fallen 11% over the last three months while the S&P 500 index is down 0.4%.

And: China casts a long shadow over stocks as earnings season opens this week

Other items:

-Amazon could be taking share from grocery stores.

“The company’s Q2 results saw an uptick in purchases of convenience items and reports indicate that Amazon has eased restrictions and removed minimums on free shipping eligibility for low-priced CPG [consumer packaged goods] items such as toothpaste or floss, which should help the company take share of this category from grocery stores and pharmacies, resulting in increasing purchase frequency from Prime members,” wrote Canaccord Genuity in a note.

Canaccord rates Amazon stock buy with a $2,250 price target.

-Amazon expected to be among the retail leaders despite uncertainty. With the holiday shopping season kicking off, experts including the National Retail Federation have highlighted the uncertainty from global issues like tariffs, even as the forecasts call for sales growth.

The NRF forecasts sales growth of 3.8% to 4.2% this year, which would bring the total to between $727.9 billion and $730.7 billion.

Read: How to buy toys for the kid who has everything -- without relying on sponsored lists from Amazon or Walmart

“We continue to expect that increased consumer confidence, wage growth, low unemployment and the strong macroeconomic environment in the U.S. will result in 2019 retail sales growth of over 4%, led by e-commerce players like Amazon, off-price retailers like TJX and Ross, value and convenience-oriented retailers like Dollar General and Dollar Tree and discounters and warehouse clubs like Walmart and Target,” said Mickey Chadha, vice president at Moody’s.

Wells Fargo data published Sept. 9 showed that Amazon accounted for 30% of retail growth in the second quarter with U.S. gross merchandise volume of $45 billion, a 19% increase from the previous year.

Tonya Garcia is a MarketWatch reporter covering retail and consumer-oriented companies. You can follow her on Twitter @tgarcianyc. She is based in New York.

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