:max_bytes(150000):strip_icc()/GettyImages-2243343982-4ece97a528d84fc4924cfc585d246dfa.jpg "Here’s How Much Traders Expect Amazon Stock To Move After Earnings")
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Key Takeaways
- Shares of Amazon, which reports quarterly results after markets close on Thursday, are expected to move 6% in either direction by the end of the week.
- Amazon is contending with increased tariff costs and wary consumers, while it makes massive investments in cloud computing infrastructure to meet AI demand.
- The stock is up about 5% since the start of the year, making it the worst-performing member of the Magnificent Seven.
Amazon (AMZN) is slated to report third-quarter earnings after the closing bell on Thursday, and some traders are betting the results can give the stock, the laggard of the Magnificent Seven so far this year, a big boost.
Amazon stock is expected to move about 6% in either direction by the end of the week, according to recent options pricing data. A move of that magnitude, based on Monday’s closing price, would put Amazon shares at about $241, their highest price since early February, or $213.
Why This Is Important
Amazon’s $2.4 trillion market capitalization makes its stock one of the most impactful in the U.S. equity market. A big share price move after Thursday’s results would have a larger effect on the major indexes than nearly every other stock.
Amazon stock has moved an average of 4.7% following its four most recent earnings reports. Shares slumped more than 8% after the company in July reported cloud revenue growth that disappointed Wall Street after strong showings from competitors Microsoft (MSFT) and Alphabet (GOOG). The last time Amazon stock rose following an earnings report was this time last year, when the company topped sales and earnings estimates on strong cloud and advertising growth.
Amazon is the worst-performing stock in the Magnificent Seven so far this year, with the company’s outsized tariff exposure weighing on shares. The stock is up just 5% since the start of the year.
Cost Cuts, Cloud Spending in Focus
Amazon’s retail business is contending with increased tariff costs and increasingly squeezed consumers, while its cloud computing unit is making massive data center investments to meet demand for AI workloads. As such, cost savings will be top of mind for investors during Thursday’s earnings call with executives.
Amazon on Tuesday announced it would cut 14,000 corporate roles, reportedly part of a larger downsizing that could see the company slash up to 30,000 office jobs, nearly 10% of its white collar workforce. And according to a recent New York Times report, some executives expect warehouse robotics to keep the company from hiring as many as 600,000 workers in the coming years.
Cloud growth and capital expenditures will also be in focus. Amazon’s infrastructure investments totaled more than $31 billion in the second quarter, about 20% more than Wall Street was expecting. Chief financial officer Brian Olsavsky forecast the second quarter’s spending would be “reasonably representative” of capex spending for the remainder of the year.
