Earnings Preview: Can Amazon and Apple Deliver?

The two Nasdaq titans can fuel further confidence and propel the market to six consecutive up months

• Amazon and Apple are scheduled to report earnings on Thursday.
• Meanwhile, stocks are coming off the longest win streak since 2021.
• Tech company results could impact broader market sentiment.

The Nasdaq (/NQ) is heading toward a July close with gains exceeding 3%, potentially bringing its monthly win streak to five—a match with its longest run since 2021. The artificial intelligence revolution and views that the Fed has maxed out its rate hike cycle fueling investor confidence in the economy's ability to achieve a soft landing and dodge a recession. These factors have stoked a bullish sentiment among investors.

Now, earnings results from Amazon and Apple, set to deliver numbers on Thursday, have the potential to open the throttle further or pump the brakes on this market rally. If those results aren’t enough, we also have the U.S. jobs report for July due on Friday, making this a blockbuster week for traders, who are increasingly becoming more bullish about the rally.

Amazon earnings preview

Amazon (AMZN) is set to report earnings after the bell on Thursday at approximately 5:30 p.m. EDT. According to Bloomberg estimates, investors expect earnings per share (EPS) of $0.66 on an adjusted basis from revenues of $131.6 billion, representing year-over-year growth of 7.3% and 8.6%, respectively.

The E-commerce company, on Monday, said that its Prime business is delivering more items at the fastest speeds ever. This news helped lift the stock on Monday, rising about 1% through afternoon trading.

However, the market will want these fast deliveries reflected in the upcoming earnings numbers. Amazon has said it is trying to control its costs—something many companies are battling after years of higher-than-average inflation and logistical problems.

Traders will put Amazon Web Services (AWS) under intense scrutiny. Microsoft (MSFT) and Alphabet (GOOG), AWS's primary competitors, reported a slowdown in their cloud business growth last week. AWS's slowdown from Q1 is likely to continue; investors probably hope for a scenario that's better than feared.

AMZN's online sales might emerge as the highlight. Although Prime Day happened after the end of the June 30 quarter, the record sales figure has boosted confidence in the segment. This confidence, coupled with a favorable outlook on the business's digital ad revenue—analysts anticipate a figure exceeding $10 billion following Q1's $9.5 billion—might drive the stock price up.

Apple earnings preview

Apple (AAPL) will report after the bell on Thursday, followed by a conference call at 5:00 p.m. EDT. According to Bloomberg, analysts expect Apple’s third-quarter adjusted EPS to cross the wires at $1.20 on $81.5 billion in revenue.

The stock price was nearly flat through afternoon trading on Monday but up over 50% on a year-to-date basis, far exceeding the S&P 500’s return. Apple typically shows some seasonal weakness in its third quarter, and investors are eagerly waiting to hear executives discuss the supply chain and associated costs before the new iPhone launches this fall.

Analysts are looking for strength to come out of Apple’s services segment, driven largely by the company’s app store. Wall Street expects a little over $20 billion alone from services. The Mac segment may also deliver surprising strength as back-to-school students shop for equipment earlier in the season. Elsewhere, analysts are also eager to hear about the Vision Pro headset.

For live daily programming, market news and commentary, visit tastylive or the YouTube channels tastylive (for options traders), and tastyliveTrending for stocks, futures, forex & macro.

Trade with a better broker, open a tastytrade account today. tastylive, Inc. and tastytrade, Inc. are separate but affiliated companies.