The holidays are quickly approaching, and with numbers like (NASDAQ: AMZN) recently reported, the company appears well-positioned to have a big season. The retailer surprised the market with a strong earnings release, but what is the company expecting for the upcoming holiday period and beyond?

Listen to the entire podcast by clicking here. A full transcript follows the video.


Sean O'Reilly: How does guidance look? They try to have their own Black Friday, or something? I look forward to that at the end of the next month.

Dylan Lewis: Oh, yeah. Amazon's Retail Day. The Amazon holiday they invented. How brilliant is that?

O'Reilly: Yeah. It's all good. So what did they say about the holidays?

Lewis: I thought there were two really cool notes from the PR release they had. One of them was: they expect a record holiday season. That gets you to perk up a little bit. Amazon expects revenue between $33.5 billion and $36.75 billion during the fourth quarter. That would be year-over-year growth of 14% to 25% depending on where they land in that range.

O'Reilly: Beautiful!

Lewis: Impressive. Operating income is expected to be somewhere between $80 million and $1.2 billion compared to $590 million in the fourth quarter of last year. The high-end of Amazon's guidance would be more than doubling operating profit year over year. That's pretty incredible.

O'Reilly: They've got to pay for that new headquarters somehow.

Lewis: Yeah. A lot of what's pushing this is their AWS growth.

O'Reilly: Right.

Lewis: What's going on in retail for them is huge, and the kind of growth they're seeing on their platform is great; but this insane stat that I saw was, "AWS accounts for about 8% for Amazon's revenue and roughly half of its profits."

O'Reilly: Oh my God.

Lewis: To give you an idea of the kind of margins that they're working with, that's insane. They seem like they're going to continue to grow.

O'Reilly: I don't know how they snuck in. I'm a happy Prime member, and I actually save all my videos and photos of my son -- I just didn't want to be totally tied to Apple for diversification's sake. I cannot comment on their AWS ...

Lewis: The B2B side of things.

O'Reilly: Yeah, the B2B side. The value proposition is awesome. It's like $6 a month, or something. Good to go. All my photos are there.

Lewis: That's been the appeal a long time for customers. You're like, "Oh, I'm getting this insane package of stuff. I'm getting free, two-day shipping. I'm getting all this media that's available to me."

O'Reilly: I love the shows on Prime.

Lewis: Shows are great; in terms of their original programming, it's really fantastic. For a long time, it's been that it's a great value proposition for customers. You can see how they're building up this huge user base. Is it going to be a profitable business?

O'Reilly: It is now!