Buy the dip in Amazon or Apple Stock as Earnings Approach?

Set to release their quarterly results after-market hours on Thursday, May 1, Amazon AMZN and Apple AAPL will highlight a much-anticipated week that features reports from big tech firms.

Investors are certainly hoping Apple and Amazon will provide better-than-expected financial figures and guidance that starts to offset tariff fears, as both of these Mag 7 stocks have fallen about 15% year to date.

That said, Amazon shares are still sitting on +50% gains over the last three years to outperform the broader indexes, while Apple’s +33% has been on par with the benchmark S&P 500 but has slightly trailed the Nasdaq.

Amazon’s Q1 Expectations

Facing backlash from the White House, Amazon had reportedly planned to highlight how higher import charges are raising prices on its platform, particularly among low-price items. Of course, Wall Street and investors alike will be seeking meaningful insight into how tariffs may affect the e-commerce behemoth’s outlook, with Amazon’s Q1 sales expected to be up 8% to $154.56 billion compared to $143.31 billion a year ago.

On the bottom line, Q1 EPS is thought to have spiked 19% to $1.35 versus $1.13 a share in the prior year quarter. Notably, Amazon has exceeded the Zacks EPS Consensus for nine consecutive quarters with an average earnings surprise of 25.27% in is last four quarterly reports.

Apple’s Q2 Expectations

Despite much of its production coming from China, Apple has managed to secure exemptions for some of its devices from the U.S. Government, including iPhones, which currently face a 20% tariff instead of the much higher rates on other goods.

Still, Apple is in a complex situation, as the tech giant relies heavily on international manufacturing and has shifted some of its production to India to avoid higher tariffs in China. Reporting results for its fiscal second quarter, Apple’s Q2 sales are slated to increase 3% to $93.56 billion from $90.75 billion in the comparative quarter.

Apple’s Q2 EPS is expected to be up 4% to $1.60 versus $1.53 per share in the prior period. Posting an average EPS surprise of 4.39% over the last four quarters, Apple has beaten earnings expectations for 8 consecutive quarters.

Tracking Amazon & Apple's Outlook

Based on Zacks' estimates, Amazon’s total sales are currently projected to rise 8% in fiscal 2025 and are forecasted to spike another 10% in FY26 to $759.21 billion. Annual earnings are expected to rise 12% this year and are projected to spike another 15% in FY26 to $7.14 per share.

Pivoting to Apple, its top line is expected to expand 3% in FY25 and is projected to increase another 5% in FY26 to $423.83 billion. Apple’s annual earnings are projected to rise 6% in FY25 and are forecasted to soar another 8% next year to $7.80 per share.

Conclusion & Final Thoughts

Amazon and Apple’s stock land a Zacks Rank #3 (Hold). To that point, their quarterly results and any guidance they can offer will need to reconfirm the attractive growth trajectories of these tech giants. Hopefully, Amazon and Apple’s outlook won’t be overly altered by higher tariffs, but there could still be better buying opportunities ahead.

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This article originally published on Zacks Investment Research (zacks.com).

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