Thursday, Jan. 30 is slated to be a big day for (NASDAQ:AMZN) shareholders, whether they want it to be or not. On Thursday, the company is due to report earnings results for its fourth-quarter and full-year 2013. Heading into earnings, is Amazon an attractive investment opportunity, or should shareholders stay as far away from the company as possible?

Mr. Market's expectations are high!
For the quarter, Mr. Market expects Amazon to report revenue of approximately $26.1 billion. If analysts are correct, this would mean the e-commerce giant's revenue has jumped 22.5% compared to the $21.3 billion reported in the same quarter a year earlier. On a full-year basis, revenue is expected to hit an all-time high of $73.7 billion, 20.6% higher than the $61.1 billion management reported in 2012.

Looking at earnings per share, the situation becomes even more extreme. For the fourth quarter, analysts believe Amazon's earnings will come in at $0.67, significantly higher than the $0.21 the company reported in the fourth quarter of 2012. On a full-year basis, the company is expected to see earnings of $0.77. Although this doesn't seem like much when you consider that the company's shares are trading at $386.28 for a P/E ratio of 501.7, it's worlds apart from the minus $0.09 that management reported for 2012.

But how has Amazon fared against the competition in the past?
In order to gain some perspective concerning any company, it's imperative to look back and see how well the company reported in the past. Doing so with Amazon will grant investors a very interesting look into how the world's largest e-commerce site has fared over time, and give some indication as to how its future might look.

Over the past four years, revenue growth at Amazon has been explosive. Between 2009 and 2012, the company saw sales rise 149.3% from $24.5 billion to $61.1 billion. The primary driver behind this growth has been a rise in e-commerce ordering globally. Between 2009 and 2011 (the most recent year for which data is available), U.S. e-commerce grew by 64.7% from $155.2 billion to $255.6 billion. Globally, e-commerce sales totaled $763.2 billion and comprised an estimated 8% of total retail sales.

In comparison, rival eBay (NASDAQ:EBAY) saw its revenue rise 61.2% from $8.7 billion to $14.1 billion. Although this is still considered strong growth, it falls far short of Amazon's growth rate. Another noteworthy e-commerce site that shouldn't be forgotten is Groupon (NASDAQ:GRPN). With a market cap of only $6.8 billion, Groupon is about one-tenth the size of eBay and less than 5% the size of Amazon. However, the company has been growing rapidly and, between 2009 and 2012, has increased revenue from $14.5 million to $2.3 billion.

In terms of revenue, Amazon is more dominant that eBay and Groupon, but the company's bottom line is a bit alarming. Over the past four years, Amazon's net income turned from $902 million to -$39 million. In comparison, eBay's net income has actually increased by 9.2% from $2.4 billion to $2.6 billion, while Groupon's net loss has widened from $1.3 million to $54.8 million.

At first glance, it appears Amazon has been able to grow, but has only been capable of doing so at the cost of profitability. However, this simply is not the case. Yes, the company did report a net loss in its most recent year, but it wasn't because of uncontrollable costs. In fact, the business saw its aggregate costs rise only slightly. Between 2009 and 2012, management reported that the company's cost of revenue fell from 77.4% of sales to 75.2%, while its selling, general, and administrative expenses rose from 12.5% of sales to 15.9%.

In aggregate, these costs grew from 89.9% of sales to 91.1%. It's when you add Amazon's rising research and development costs, which climbed from 5.1% of sales to 7.5%, that the picture at Amazon starts to make sense. This rise in R&D expenditures is one of the primary drivers behind the company's cost structure, but it's not necessarily a bad thing.

In order to grow a business, most companies (especially technology-based ones) tend to invest in R&D so they can improve their products or services. This has been Amazon's goal in recent years. Sure, management could have reported earnings of $3.3 billion (or $7.25 per share) in 2012 by eliminating R&D expenditures, but the company hopes forgoing profits today will lead to healthier profits tomorrow.

Foolish takeaway
Currently, Groupon is growing much faster than Amazon, and eBay is more profitable than Amazon. However, the actual situation is more complex than that because of the R&D Amazon has been conducting. In the short run, R&D has been a real expense and a driver of lower profitability. But if you strip this out for Amazon and eBay (Groupon doesn't report R&D individually), then Amazon's adjusted net income growth rate of 76.5% trounces eBay's 28.8% rise in profitability.

In the long run, the trick for Amazon will be to convert the R&D expense it's incurring into rising revenue and margins. If the company is unable to do that, then its endeavors will have been pointless. Looking at its historic revenue growth and adjusted net income growth over time, though, it looks like the company might be on the right track. For an investor who has a long-term investment approach and who doesn't mind mediocre profitability in the meantime, this could lead to hefty returns down the road.

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Daniel Jones has no position in any stocks mentioned. The Motley Fool recommends and eBay. The Motley Fool owns shares of and eBay. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.