CFDs are complex instruments. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money. CFDs are complex instruments. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

Amazon Q3 results: analysts tipping a fall in earnings as online shopping boom fades

Amazon will post Q3 results this week, with analysts tipping a drop in profits on fading online shopping boom and supply chain bottlenecks.

Amazon earnings – what to expect

It’s tipped to be a relatively disappointing quarter for Inc (All Sessions), compared to the last year of results. According to numbers from Zack’s Investment Research published via, EPS ought to fall to $8.72, almost half of what they were in the previous two quarters, and down approximately 30% on annualised basis. Despite this, analysts are tipping fairly robust revenue growth across the business for the quarter, with sales remaining relatively strong, driven in large part by growth in the cloud services business. However, sales estimates have been downgraded recently by analysts, with the fall in EPS for the quarter attributable the re-shift in consumer behaviour away from online spending in the US, along with margin erosion due to the impacts of supply chain bottlenecks across the globe.

Amazon earnings – valuation, broker views and sentiment

Despite the expectation of weaker profits for Amazon this quarter and the risk of sustain headwinds in the future, the broker community remains very bullish on the company’s stock. Of the 52 brokers surveyed by Refinitiv, 50 hold either a “buy” or “strong buy” rating, while only 2 rate it a hold. Sentiment amongst IG’s client bases remains similarly bullish, with 97% of clients currently long, and only 3% short.

Amazon stock – technical analysis

Price action for Amazon shares is arguably reflecting the growing anxiety about the company’s profits and growth outlook. Though the long-term trend remains to the upside, price momentum is trending to the downwards, with the weekly RSI currently only just above the 50-level. Further to that, price is carving out a bearish descending triangle pattern right now, suggesting further downside to come if technical support at $3180 breaks. Such a move would open up a fall to key support around $3000 per share. On the other hand, a break out to the topside off this pattern would negate the bearish view on the stock, with resistance at $3560 the level to watch on the upside.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

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