Numbers can be confusing, especially with the fast and changing atmosphere of the stock market. But these are also keys to a successful investment venture. As a new Amazon seller, you must understand that Amazon earnings report will help you see if the platform is doing well or not. You shouldn’t base your decisions on estimates. Instead, you should be working with concrete data. Read further to know more about it.
All publicly-traded companies (including Amazon) are required, by law, to file their earnings reports to the Securities and Exchange Commission (SEC). Specifically, companies need to file the following:
Form 10-Q has two main parts: the Financial Information and Other Information.
Financial Information contains the financial statements that include:
The first part of the report shows how much the beginning balance is, an itemized statement of all transactions, and the ending balance during the quarter cut-off. Financial statements essentially form a map of how cash flows in and out of the company, losses, costs, expenditures, profits, and acquisitions for the quarter's duration.
The SEC beginner's guide to financial statements summarizes and explains this well.
Other Information contains:
The second part of the report includes information that shareholders need to know. It’s where Amazon presents discussions about significant events, factors, services, and more. These further explain the company's current status, plans, and risk assessments.
Amazon is a Large Accelerated Filer, which means they have 40 days from the end of the quarter to file and share their quarterly earnings report. Should they fail to submit reports within the given timeframe, they would result in penalties.
Everyone is free to access these reports in SEC's EDGAR Database. Just use the search bar and type “Amazon.” You’ll then be redirected to the page where all filed and submitted Amazon reports can be viewed.
Another option is to visit Amazon's official website and click on Investor Relations (you should find this at the bottom of the page). You’ll be redirected to a page that compiles all of Amazon's SEC documentation, press releases, and other investor-related information.
Now that you know when these announcements are made and where to access them, it's now time to make sense of it all.
Which of these should mean the most to you?
Of most interest to holders of Amazon shares are earnings results showing revenue growth. Revenue is the income for the quarter against inflation and other costs. Expectations for the next quarter are based on a previous Amazon earnings report. If net sales or net income are unfavorable, so too are future Amazon shares.
As an Amazon seller, you might feel like knowing these things shouldn’t be of utmost importance. However, knowing how to read these reports (at the very least!) can help you make decisions that would definitely affect your business firsthand. Here are other reasons why you should check Amazon’s reports every now and then:
Quarterly earnings reports are windows to a company's work and cash flow. They reflect if a company has good financial managers by gauging its performance and balancing loss and profits. So, no surprise that these report cards can also affect the market stock prices.
Aside from insights, Amazon's earnings report shows interested investors how risky or safe their company is. Investors vary from one another. Some are into risky investments that promise better returns while some would like to play it safe. So, an earnings report, like the 10-Q, can help one decide whether a company is within your risk spectrum.
Overall, Amazon earnings reports, quarterly or otherwise, are invaluable tools and deciding factors for both long-term and short-term investors.
Whether you're interested in investing in Amazon stocks or are already a shareholder, a quarterly earnings report is one way to get a comprehensive look at Amazon's financial status. It’s an informative document that allows Amazon to be transparent with its partners. Disclosure and discussion of projects and activities are included to help investors understand where Amazon is headed, moving forward, and whether or not the risks are worth it. For more information and relevant news delivered straight to your e-mails, subscribe to Seller Bites. Get bite-sized, easy-to-consume content that's perfect for on-the-go marketers and sellers!