UPDATE—Oct. 31, 2024: This article has been updated to reflect more recent analyst estimates and share price information.

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 澳洲幸运5官方开奖结果体彩网:artificial intelligence (AI) could squeeze profits.

Amazon shares took a hit after the company released its 澳洲幸运5官方开奖结果体彩网:second-quarter report in July, as its quarterly sales and outlook missed expectations. Since then, shares havꦫe largely recovered to their level before the report, leaving them about 23% higher for the year so far at $1ꦫ86.68 in Thursday afternoon trading.

Analysts expect Amazon's third-quarter revenue to come in at $157.27 billion, up from the prior quarter and year-ago period. However, profits are projected to fall sequentially to $12.38 billion as expenses climb, despite rising roughly 25% year-over-year.

Key Metrics: AWS, Advertising Revenue

澳洲幸运5官方开奖结果体彩网:Amazon Web Services (AWS) and a growing advertising business for showing ads on Prime Video have been key sources of 澳洲幸运5官方开奖结果体彩网:revenue growth so far this year. A migration to cloud storage and growing use of AI products have helped boost AWS revenue. Jefferies analysts said recently their checks suggest growing AWS revenue in the third quarter.

The analysts also said they have seen "solid & improving" demand for ad spending with Amazon. Wedbush analysts said they believe high-margin ad revenue could help offset big spending from Amazon to fuel its AI efforts, along with things like 澳洲幸运5官方开奖结果体彩网:Project Kuiper, its planned satellite broadband project.

Business Spotlight: Returns on AI Spending

A number of big tech companies including Amazon face 澳洲幸运5官方开奖结果体彩网:pressure from investors to show that their spending on AI is paying off. Amazon CEO Andy Jassy said in the company's 澳洲幸运5官方开奖结果体彩网:first-quarter earnings call that it wouldn't be spending so much on AI if it didn't see "very clear signals" that Amazonꦡ could monetize it.

JPMorgan analysts told clients earlier this month it will be important for Amazon, along with other tech giants, to "highlight their early returns on AI spending" in their earnings calls.