Investors And Online Retailers Anticipate Amazon Results (AMZN, AAPL, BKS)

Web retailer Amazon.com Inc AMZN is scheduled to release its first quarter earnings following the market close today. Currently, Amazon is the top online retailer, which means people will be watching to see how it performs because of the implications it carries for the rest of the online retail market. If Amazon can't post strong first quarter earnings, it doesn't leave much hope for its competitors. The results looming, Amazon shares were down 1.7% to $182.35 today. Amazon is expected to report a growth in sales, but due to the fact the company is currently investing in its own infrastructure, its operating margin is weak. Dan Gallagher of MarketWatch explains, “Net Income is expected to decline to 61 cents a share from 66 cents a share in the year-earlier quarter. Operating earnings are expected to slip by 7% to $365.8 million, bringing the closely watched operating margin figure in around 3.8%-- which is at the high end of the company's outlook for the period.” Amazon's biggest source of revenue stems from electronics and general merchandise including books, CDs, and DVDs. Amazon's Kindle faces steep competition against Apple's AAPL iPad and Barnes & Noble's BKS Nook. While Amazon's operating margins will suffer due to the infrastructure investment, Heath Terry of Canaccord Wealth Management told MarketWatch, “We believe that, as with past investment cycles at Amazon, higher levels of sustainable growth and margin expansion are likely to follow starting by the fourth quarter of this year.”