Amazon: Why I Am Not Worried About The Company

Simple Investing
08-15

Summary

  • Amazon's 2Q24 results beat expectations, with retail coming in mixed while AWS exceeded expectations.
  • AWS saw acceleration for the third straight quarter, with management commentary skewing positive.
  • Cost optimizations are likely a thing of the past and customers are now looking to add new projects and spend more on cloud migration and AI.
  • Retail was mixed as Amazon continued to grow faster than the industry, but customers are reducing discretionary spend and trading down.
  • There were also some encouraging announcements for Project Kuiper.

Anderson Coelho

While Amazon.com, Inc. (NASDAQ:AMZN) has fallen almost 20% from the peak to the trough, I am not worried about the company.

In fact, I have a buy investment rating for Amazon and remain positive about the long-term opportunity for

2Q24

Revenue growth (Amazon)

AWS segment (Amazon)

North America segment (Amazon)

International segment (Amazon)

The 3Q24 guidance for revenue came in the range of $154 billion to $158.5 billion, somewhat in line with consensus expectations

AWS acceleration

Amazon segment breakdown (Amazon)

Project Kuiper

Retail business

Valuation

Summary of 5-year financial forecasts (Author generated)

Conclusion

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