Revenue will be below expectations and traditionally Amazon's stock price has been driven by revenue growth. Profitability has always been ignored.
I think this quarter will mark a significant shift in focus from revenue growth to margins and investor reaction is a big unknown right now.
Amazon has 1.5% margins. Target and Walmart are in the 20% to 28% range.
Amazon can improve their margins quite a bit, but it will require significant investments in warehouses, logistics, etc..
I don't think Amazon has a choice in this matter. There is a global recession on the way so 30% year over year growth in revenue is going to be really difficult. They may be shifting and trying to improve margins.
The question will be whether this company will still be viewed as a growth firm deserving of a 200 plus PE ratio once they start battening down the hatches.
There is a lot of uncertainty right now and the smart move is to take profits and run..