Seeking Alpha

Amazon Prime may be wildly popular, but it's taking a toll on Amazon's (AMZN) profits, notes...

Amazon Prime may be wildly popular, but it's taking a toll on Amazon's (AMZN) profits, notes Jeff Bailey. Thanks in no small part to Prime, Amazon's net shipping costs grew to account for 4.9% of its net sales in the first 9 months of 2011, up from just 2.9% in 2007. Soaring shipping costs and capex helped compress Amazon's Q3 margins, and thereby contributed to its earnings miss.
Comments (1)
  • So Amazon wants people to buy Fire in order to have them subscribe to Prime ....

     

    But meanwhile, Fire is a loss leader itself and Prime isn't generating any profit due to high shipping costs (not to mention online content delivery) ??

     

    And still has a P/E of 92.... truly amazing
    12 Jan 2012, 04:20 PM Reply Like
DJIA (DIA) S&P 500 (SPY)