Amazon.com (AMZN) Q2 Domestic Revenue Tracking Below Consensus - M Science

(Updated - June 27, 2016 2:52 PM EDT)

Amazon.com (NASDAQ: AMZN) is modestly lower Monday (-1.2%) in part after M Science (formerly ITG Investment Research) analyst Steven Weinstein said domestic revenue results are tracking below high expectations, although momentum looks positive.

"Based on our analysis of data through May, we are forecasting Q2 domestic revenue that is slightly below consensus," Weinstein said. "However, we see increasing momentum in Amazon customer trends, which we view as positive going into 2H'16."

The firm estimates Amazon Q2 '16 domestic revenue of $17.350 billion, which is modestly below consensus of $17.429 billion and reflects 25.8% Y/Y growth compared to 26.8% Y/Y growth in Q1'16. "While our estimate reflects a deceleration in Y/Y revenue growth, our analysis suggests that growth is stable with Q1 ’16 if we exclude the impact of the extra day. Based on our data, we believe customer growth and growth in transactions per customer are driving domestic revenue growth."

The firm estimate Amazon Q2 '16 international revenue of $9.280 billion, up 22.7% Y/Y and slightly above consensus of $9.273 billion.

Their estimate for Q2 ’16 unit growth is flat with last quarter at 27%.

Combining their estimates for domestic and international revenue with the consensus estimate of $2.824 billion for AWS, they estimate Q2 '16 total revenue of $29.454 billion, which is slightly below consensus of $29.556 billion.

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