Amazon expected to report 1st-quarter growth well above last year

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Earnings Preview: Amazon to report 1Q results

SAN FRANCISCO — Online retailer Amazon.com Inc. is scheduled to report its first-quarter earnings after the stock market closes on Thursday.

WHAT TO WATCH FOR: Despite the weakened economy, Amazon has continued to show strong gains in profit and sales. In the year-ago quarter, its profit rose 24 percent. It is expected to do far better than that this time around as consumers get increasingly comfortable opening their wallets again.

Analysts expect Amazon to report growth in both of its main categories — books, CDs, DVDs and other media, and electronics and other “general merchandise.”

The first quarter was also the first full quarter including contributions from online shoe and apparel store Zappos, which Amazon bought in November 2009. In the fourth quarter, Zappos added $200 million to Amazon’s revenue.

As in the past, the company will probably decline to give specifics about sales of its Kindle electronic reader — so far it has only said that “millions” have been sold.

It has dropped some hints about sales of Kindle e-books, though, which can be read on the Kindle itself and devices like personal computers and iPhones. Recently, Amazon said that for every book it sells both in hard copy and the Kindle format, it sells 48 Kindle books for every 100 hard copies — a figure the company could update with its quarterly report.

WHY IT MATTERS: Since it is the leading online retailer, Amazon’s results can give a sense of how the rest of the online retail market is faring. However, the company has done extremely well despite overall weakness in the economy, so its report isn’t necessarily indicative of how its peers are doing.

WHAT’S EXPECTED: Analysts surveyed by Thomson Reuters expect a profit of 61 cents per share on $6.86 billion in revenue.

LAST YEAR’S QUARTER: During the first quarter of 2009, Amazon earned 41 cents per share on $4.89 billion in revenue.

Eds: CORRECTS day of earnings report.