Amazon's (AMZN 2.21%) first-quarter earnings release prompted some investors to abandon ship. On the day following the release, the company's stock price declined by over 14%. That sell-off led to a further sell-off across the broader market, especially tech stocks.

Investors in Amazon -- which is still showing signs of growth, albeit slower than in the past -- are likely wondering if the ship is still sailing along or is it starting to take on water?

The answer is probably a little of both, but there's no real worry that it's actually sinking. That bodes well for long-term investing sailors looking to climb aboard this ship at a discount. That's because Amazon's stock price drop may turn out to be a great buy-on-the-dip opportunity.

Business person sitting in front of monitors displaying growth charts.

Image source: Getty Images.

Web Services are still growing at a rapid pace

One of the main highlights of the Q1 report was that Amazon Web Services (AWS) grew 34% on an annualized basis over the past two years and 37% year over year in Q1. That continued strong growth helped the company keep its overall net loss to $3.8 billion for the quarter. The net loss was attributed to several factors, including currency exchange rates, increased employment costs, and inflationary pressures. All tend to be short-term issues rather than long-term problems.

AWS is generating a 35% margin, up from 29% in the fourth quarter, and the profitability of AWS is helping subsidize the expansion efforts in other parts of the company in areas like health services, media, gaming, music, and esports. Those smaller segments have been a drain on the bottom line. Some investors are questioning whether Amazon needs to tighten its focus a bit.

The big lowlight of the report was an update on Amazon's investment in Rivian. The Rivian share price decline was responsible for over $7 billion of pre-tax losses for Amazon. The stock could drop further, but with Rivian's current share price sitting 62% below its IPO price, it's not likely to fall as far in the next quarter. Investors should note that Amazon's original out-of-pocket investment in Rivian was around $1.3 billion, not $7 billion. If Rivian's shares bounce back, it will turn this quarter's losses into next quarter's gains.

Company perception counts for something (at least for me)

So there were good things to see in Amazon's report and some potentially concerning things. But how should they affect a long-term investor's decision-making regarding the stock? Sometimes an investment decision can be influenced by past investment decisions or things we see in daily life.

Years ago (and many investing decisions ago), I sold my Netflix shares after a down quarter. At the time they were worth $83 per share. Last fall, Netflix was trading around $700 (although it's now around $204 a share), but I had never gotten back in. Lesson learned: If you're a long-term investor, think long-term and don't pull the sell trigger because of one weak quarter.

There are also incidents in daily life that can also influence an investing decision. I realized this with Mcdonald's in late 2019. As a customer, poor service I was receiving at my local McDonald's drove me elsewhere. Coincidentally, the stock happened to be falling at the time (and dropped even more at the start of the pandemic). After staying away for a year or two, a refreshed look for the restaurant and better service convinced me to return to McDonald's. Coincidentally, the stock price is trading near new highs. Sometimes you just have to trust your gut.

These anecdotes go some way to explaining my reaction to Amazon at the moment. Recently, I've found myself going to Target or Dicks Sporting Goods more because of a perception that Amazon deliveries were taking longer to process or other merchants were offering better deals. Again, it's likely just a coincidence, but my personal experience with Amazon lately is influencing my perception of the stock as well.

This negative perception might have been a red flag for me leading into Amazon's Q1 release. But the shopping experience lately is only part of my Amazon experience. I'm still paying my Amazon Prime subscription because I know that the majority of purchases will come from Amazon and I still consider it a deal. Plus, as pointed out, Amazon is much more than just an online sales platform and there are other reasons to like the stock that aren't part of my personal experience with the company.

For instance, the company is processing a 20-for-1 stock split at the close of business on June 3. I know a split doesn't change the intrinsic value of the company, but recent splits do seem to generate some retail investing enthusiasm. Amazon's lower per-share price will potentially become more intriguing to those who are looking to get full shares of a company rather than buying fractional shares.

Amazon itself may take part in buying stock with an approved $10 billion share buyback plan. This could provide further upside potential for investors who choose to not let a near-term bump in the road deter a long-term investment strategy involving one of the best tech stocks of our time.