Amazon.com (Nasdaq: AMZN) Earnings: A 238% Increase Expected

When Amazon.com (Nasdaq: AMZN) Q4 earnings come out after the bell today (Thursday), reported earnings growth for Q4 could be a staggering 238% increase from a year prior.

The consensus estimate is that AMZN quarterly earnings will increase from $0.21 per share this time a year ago to $0.71 per share. Revenue is predicted to shoot up 23% compared to a year before, going from $21.27 billion to $26.06 billion. Revenue for 2013 is projected to hit $73.7 billion.

AMAZON.COM NASDAQ: AMZN Jan 30 02:11 PM loading chart... Price: 401.73 | Ch: 17.53 (4.4%)

That's quarterly earnings growth of 238% year over year, compared to 167% earnings growth in 2012's Q4.

The forecasts are aggressive - but not unrealistic. Here's why.

The key to Amazon's success is innovation.

"These guys leave no stones unturned for the next dollar they can bring in," said Money Morning Defense & Tech Specialist Michael A. Robinson. "Amazon is constantly upselling, cross-selling, and looking for new products, and they're great at it."

Amazon is one of the world's largest online retailers, but it also creates original media content in its publishing division, offers cloud services, and sells products like the popular Kindle.

Popular is an understatement: On Dec. 26, Amazon announced it sold 426 items per second on 2013's Cyber Monday, including more Kindles than ever before in the company's history. That comes out to more than 36.8 million items ordered in 24 hours.

Also in late December, Amazon won a patent for a shipping method that could drastically decrease shipping times...

"They already do anticipatory shopping - customers see that every time they open the web page. Now they want to expand that to anticipatory shipping," said Robinson.

With the patent, AMZN will strengthen its spot as the No. 1 online retailer by boasting some of the fastest delivery times for online purchases.

Another major reason for AMZN's success... Amazon Prime.

Amazon Prime is a membership service that offers free two-day shipping, unlimited movie streaming, and one free borrowed e-book per month for a total of $79 per year. In just one week in December, Amazon Prime gained more than 1 million new subscribers.

Additionally in December we learned that AMZN will launch Pantry, a membership warehouse that allows members to buy consumer package goods. Pantry opens the gateway for Amazon to compete with Costco Wholesale Corp. (Nasdaq: COST), Sam's Club, and Wal-Mart Stores Inc. (NYSE: WMT).

Robinson believes developing Pantry fits right in Amazon's wheelhouse, and credits a lot of the company's success to Amazon Chief Executive Officer Jeff Bezos.

Bezos is "brilliant at logistics," said Robinson. "[He] is going to go down in history as one of the great tech innovators of all time."

Amazon stock went up a whopping 62% in 2013 - and will keep going.

"Once this franchise is built out, there are billions of dollars in cash flow that will fall to the bottom line," Robinson said.

In a Dec. 30 research note to investors, analysts at Citigroup Inc. raised their AMZN stock price target from $381.00 to $457.00, citing the company's momentum in online retail and cloud services that they believe will continue into 2014.

Amazon (AMZN) stock closed at $384.20 (down 10.23 or 2.59%) Wednesday and is trading up 4% to $400.20 in midafternoon trading.

Profit Alert: These "Triple Threat" Firms Will Deliver Your Best Returns in 2014