Amazon.com Inc. (NASDAQ:AMZN) is expected to post steady third-quarter gains powered by strong cloud, advertising, and retail performance.
Apple Inc. (NASDAQ:AAPL) and Microsoft Corp (NASDAQ:MSFT) are both positioned for solid quarters — Apple benefiting from surging iPhone 17 demand and resilient Services revenue, while Microsoft extends its AI and cloud leadership through accelerating Azure momentum and heavy data center investments.
Evercore ISIS analyst Mark Mahaney maintained an Outperform rating on Amazon with a price forecast of $280.
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Mahaney expects Amazon to deliver a modest third-quarter beat, driven by solid growth in Amazon Web Services (AWS), resilient retail performance, and strong advertising momentum. The analyst projects revenue of $178 billion and operating income of $19.5 billion.
He anticipates AWS revenue will grow 18% year over year, with margins slightly below consensus but improving as depreciation normalizes. Mahaney expects North American retail revenue to reach $104.7 billion, up 10% year over year, and International retail revenue to reach $41.2 billion, up 15%. The analyst sees advertising growth remaining strong, supported by Prime Video and connected TV partnerships.
Mahaney believes automation in fulfillment centers will yield cost efficiencies despite tariff risks. The analyst adds that expanding Prime Same-Day to grocery delivery enhances customer engagement and competitive positioning, though its near-term financial impact may be limited.
Evercore ISI analyst Amit Daryanani maintained an Outperform rating on Apple, with a price target of $290.
Daryanani sees Apple positioned for a strong quarter, fueled by robust iPhone 17 demand and easing headwinds in its Services segment. The analyst expects Apple's Services segment to continue to grow at a double-digit rate.
Daryanani forecasts revenue growth of around 8.6% sequentially, with potential upside from late-quarter iPhone sales and App Store strength. The analyst expects gross margins between 46% and 47%.
Looking ahead, he anticipates continued iPhone momentum in the December holiday quarter, supported by strong upgrade interest: 59% of surveyed consumers plan to buy the iPhone 17, above the historical 45% average.
Evercore ISIS analyst Kirk Materne maintained an Outperform rating on Microsoft with a price forecast of $625.
Materne expects Microsoft to deliver a strong fiscal first-quarter performance, driven by accelerating momentum in Azure and AI.
The analyst anticipates Azure's growth to top the company guidance, with AI emerging as a key catalyst, though capacity constraints could limit short-term upside.
He expects capital expenditures to remain elevated as Microsoft expands its data center footprint.
While capex growth may moderate after fiscal 2025, Materne believes continued AI infrastructure investments will sustain long-term growth.
Materne expects the upcoming earnings call to focus on Microsoft's partnership with OpenAI, progress with Copilot adoption, and broader enterprise cloud migration trends.
Price Action: Amazon shares were trading 0.93% higher at $229.10 at last check on Tuesday.
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