I'd Buy Half a Position in Amazon Stock Before Its Oct. 29 Report -- and Half After
I'm LongbridgeAI, I can summarize articles.The author recommends buying half of an Amazon (AMZN) position before its Oct. 29 earnings report and the other half after, due to high post-earnings volatility. While acknowledging Amazon's strong AWS growth and operating income trends, the strategy aims to mitigate risk from potential stock swings. The second purchase is scheduled regardless of immediate market reaction, unless fundamental business shifts occur.
Amazon (AMZN -0.95%) is set to report earnings for the third quarter on Thursday, Oct. 29. If its latest reports are any guide, the stock might move a lot the next day. Shares surged about 15% the day after the company's July 30 report, and they slid about 6% after its February report.
The stock trades near $252 as of this writing, about 11% below its Aug. 3 closing high of $284.02. I still think it's a buy.
But I don't know which way it'll go after Thursday's report, and I don't think anyone else does either. I'd split the purchase instead: half a position before the report, and the other half after it.
Image source: The Motley Fool.
Amazon stock has made big moves after its reports
Amazon shares gained around 10% on Oct. 31, 2025, the day after the company's third-quarter 2025 report, and dropped about 6% on Feb. 6, after its fourth-quarter results. The first-quarter report on April 29 hardly moved the stock, which gained less than 1% the next day. Then came the 15% surge on July 31.
Three of those four moves were up. But four reports is a small sample.
Amazon's hefty spending on artificial intelligence (AI) also leaves room for surprises.
Free cash flow over the trailing 12 months was a $7.6 billion outflow, so any shift in its spending plans might move the stock sharply in either direction.
Splitting the buy doesn't improve the average outcome, but it does tighten the range. Take a $10,000 purchase made the day before the February report. Bought in one go, it would've lost around $555 by the next close. Split in half, the first $5,000 would have lost about $278, and the second $5,000 would have bought shares about 6% cheaper.
The July report went the other way. All $10,000 would have gained around $1,532 the next day. But the split would have gained only about $766, and it paid about 15% more for its second half.
Put another way, the split gives up some upside in exchange for never going all in on the wrong night. With a stock I plan to own for years, that looks like a fair trade.
Why buy any shares before the report?
Waiting with the full position has its own cost, because Amazon's business keeps getting stronger.
Amazon Web Services (AWS), the company's cloud computing segment, has seen its sales growth accelerate for five straight quarters. In the third quarter of 2025, AWS sales grew 20% year over year, up from 17.5% in the second quarter and 17% in the first. Growth then climbed to 24%, 28%, and, in the second quarter of 2026, 37%. The segment's operating income rose even faster, to $16.6 billion from $10.2 billion a year before. And Amazon's total operating income hit $27.5 billion, up 43% year over year, after 30% growth in the first quarter.
Amazon's third-quarter guidance is for operating income between $22.5 billion and $26.5 billion. This compares to $17.4 billion a year ago, or $21.7 billion without two special charges (a Federal Trade Commission settlement and severance costs). Even the low end of the range would top that adjusted number.
I made my five-year case for the stock last week, and none of it rides on what shares do on Oct. 30. Sure, shares cost around 24 times what analysts expect Amazon to earn in 2027. The stock isn't cheap, and that premium is arguably one reason a disappointing report might still send it down.
AMZN - Amazon
NASDAQ · As of 4:00 PM ET 10/23/26
Moneyball Superscore87/100Key data points
The second half gets its date before the report
I'd set the day for the second buy now, instead of waiting to see how the stock reacts. Picking it afterward turns the plan back into a guess at the next move.
Amazon forecast third-quarter sales growth of 9% to 12%, well below the second quarter's 20%. But this year's Prime Day was June 23-26, during the second quarter, and management said third-quarter growth would be almost 4 percentage points higher with Prime Day taken out of both years.
What would make me skip the second half is a shift in the business, not a drop in the share price. If AWS growth slowed back toward the 20% rate from a year ago, or operating income was under the guided range, I'd rethink my position.
Is Amazon stock a buy before Oct. 29, then? I think so, but just for half of what I'd eventually want to hold. The other half can wait a few days, until the quarter's results come out.