AMZN & EBAY: Global Commerce Platforms Delivering in Q1

2012 has brought about record breaking success for Amazon.com AMZN, with the company boasting some of the highest numbers it has seen in the past six years. With online retailers such as AMZN and eBay EBAY bringing in better-than-expected earnings, first quarter results proved to be impressive and the future appears to be promising. Amazon beat revenues by 2% in its first quarter earnings call, with an unexpected proforma operating margin of 3%. Even more exciting for the online retailer? The double digit gross sales per customer rebound predicted by management in guidance. "3P GMV will continue to grow at very strong levels, and even if 3P unit growth begins to decelerate, the business' reported gross margin contribution will be highly accretive to a 1P business that will likely see gross margin stabilization in both CQ2:12 and CQ3:12," Morgan Stanley said in a report this morning. But the company is not out of the woods yet. Amazon.com has been a tough one to call for investors over the past three years or so, as results continue to come in all over the map. Piper Jaffray expects to see this "lumpiness" continue up until 2015, when a sustainable 5% operating margin may be feasible. Meanwhile, the company can celebrate its accomplishments of the moment. AMZN saw its best gross margin results since 2006 this quarter, reporting 24.4% vs. the Street's 22.6%. The positivity buzz this morning rubbed analysts the right way, as Piper Jaffray raised AMZN's PT from $218 to $260, and J.P. Morgan raised PT from $210 to $250. eBay also experienced a great quarter, according to its strong earnings report last week. Investors were thrilled with the Pay Pal-driven growth the company saw, as were analysts at Indigo Equity. "PayPal revenue growth accelerated to +32%, to $1.3 bn. TPV increased 24%. Revenue was driven by both more accounts and more payments per account. PayPal is getting more revenue & profit from each $1 that it processes," Indigo Equity said in a research report last Friday. As momentum continues to build behind the global commerce platform, EBAY is positioned to beat once again in Q2, with July options set to capture the next earnings report. Shares of EBAY and AMZN are clearly on the rise, with much to back up the positive view investors are currently holding on each respective stock. The next few months are sure to see further changes in the online retailer market that are bound to affect whether the companies will continue to beat earnings in 2012. AMZN is currently trading at $227.96, up +31.6% YTD, while EBAY is currently trading at $41.11, up +35.55% YTD.