What You Need To Know Ahead of Amazon’s Earnings Thursday [Video]

Amazon (AMZN) reports earnings after the bell Thursday, with investors likely to be watching the tech giant’s margins amid concerns consumer weakness, growing labor costs, and higher spending on artificial intelligence (AI) could squeeze profits.

Amazon shares took a hit after the company released its second-quarter report in July, as its quarterly sales and outlook missed expectations. Since then, shares have largely recovered to their level before the report, leaving them about 24% higher for the year so far at $187.83 as of Friday’s close.

Analysts expect Amazon’s third-quarter revenue to come in at $157.24 billion, up from the prior quarter and year-ago period. However, profits are projected to fall sequentially to $12.32 billion as expenses climb, despite rising roughly 25% year-over-year.

Amazon Web Services (AWS) and a growing advertising business for showing ads on Prime Video have been key sources of revenue growthso far this year. A migration to cloud storage and …