Amazon (AMZN) Q3 earnings report 2023

Amazon is scheduled to report third-quarter earnings after the market close Thursday.

Here are the key numbers Wall Street is watching:

• Earnings per share: 58 cents expected among analysts surveyed by LSEG, formerly known as Refinitiv
• Revenue: $141.4 billion expected among analysts surveyed by LSEG

Investors will also be looking at business units:

• Amazon Web Services: $23.2 billion in expected revenue, according to StreetAccount
• Advertising: $11.6 billion in expected revenue, according to StreetAccount

After Amazon’s growth slowed dramatically last year due to rising inflation and economic concerns, expansion has ticked up a bit in 2022, though it’s still weaker than usual for the company. Amazon’s retail business is expected to show some improvement from consumers tepidly resuming discretionary spending.

Analysts are expecting growth of 11% in the third quarter, marking a slight acceleration from the past couple quarters. E-commerce sales boomed during the pandemic, then slowed as shoppers returned to physical stores.

Investors will be listening closely to commentary about the fourth quarter, which includes the critical holiday period. The December quarter will also include the results of Amazon’s Prime Day sequel, which took place in October and “outpaced” last year’s event, according to the company.

Analysts surveyed by LSEG are looking for fourth-quarter earnings per share of 66 cents and revenue of $166.6 billion, an increase of close to 12% from a year earlier.

Amazon’s cloud computing business, the company’s profit engine, will also attract close scrutiny from Wall Street. Growth at Amazon Web Services has slowed in recent quarters as big businesses looked to reel in spending.

The frenzy around generative artificial intelligence is leading to bigger workloads in the cloud, which should be a boon for AWS and its rival public cloud vendors. But Amazon’s smaller competitors in the space, Google and Microsoft, have reported mixed results so far.

Alphabet’s Google Cloud business posted revenue of $8.41 billion, falling short of consensus estimates of $8.64 billion. Sales in Microsoft’s Azure cloud unit grew 29%, faster than the 26% expected by analysts, sparking some concern that the software maker could be eating into AWS’ market share.

Amazon shares are up 42% this year, topping the Nasdaq’s 23% gain. Investors have cheered the company’s cost-cutting efforts after it became clear that Amazon, like many of its tech peers, had expanded too quickly during the pandemic.

CEO Andy Jassy, who succeeded founder Jeff Bezos at the helm in mid-2021, announced in March that the company would cut 9,000 jobs on top of the 18,000 layoffs announced from late last year to January of this year. Jassy said the March round would affect employees in Amazon’s advertising, cloud computing, Twitch livestreaming and human resources divisions. 

WATCH: The market now sees Amazon as more of a cloud and generative AI company