Seeking Alpha

WSJ: Amazon smartphone arriving in September

  • Is the long-rumored Amazon (AMZN) smartphone finally on tap? Sources tell the WSJ the e-commerce giant plans to begin selling a smartphone by the end of September after announcing it in June, and has been showing off demo models to developers.
  • In-line with past rumors, Amazon reportedly will include a display capable of showing 3D images (no glasses needed) with the help of eye-tracking tech and four front-facing cameras. Past 3D phone attempts didn't pan out, but the technology they used was less sophisticated than what Amazon is said to be relying on.
  • An Amazon smartphone would undoubtedly include access to the company's broad app/content ecosystem. But assuming Amazon continues using its home-grown version of Android, it won't have access to the Google apps/services (Now, Maps, Gmail, YouTube, etc.) that come bundled with Google's version of Android.
  • The phone would also enter a crowded smartphone landscape featuring Samsung, Apple, and a slew of Chinese OEMs (Lenovo, Huawei, Xiaomi, ZTE, etc.) competing aggressively on price.
  • A caveat: Two recent WSJ reports involving Amazon wound up being denied by the company.
  • Update: Re/code reports two Amazon smartphones are being prepped
Comments (27)
  • Bouchart
    , contributor
    Comments (801) | Send Message
     
    If there's one thing this world needs, it's more smartphones.
    11 Apr 2014, 05:39 PM Reply Like
  • bd4uandu
    , contributor
    Comments (2022) | Send Message
     
    The phones get smarter and the people get dumber.
    11 Apr 2014, 09:42 PM Reply Like
  • youngdub774
    , contributor
    Comments (84) | Send Message
     
    There's not one commoditized business out that Amazon doesn't want to be in
    11 Apr 2014, 05:43 PM Reply Like
  • chopchop0
    , contributor
    Comments (3864) | Send Message
     
    It's the only way to keep the profitless quarters coming....
    12 Apr 2014, 01:14 AM Reply Like
  • Yokyok
    , contributor
    Comments (330) | Send Message
     
    If there's one thing this world doesn't need, it's a 3d smartphone.
    11 Apr 2014, 05:44 PM Reply Like
  • keentolearn
    , contributor
    Comments (130) | Send Message
     
    Highly silly move again.
    11 Apr 2014, 05:48 PM Reply Like
  • Budavar
    , contributor
    Comments (1387) | Send Message
     
    Each day AMZN stock tumbles, Bezos dreams up another "feel good" PR, methinks.

     

    The next day or so, when investors realize the "feel good" PR has near zero EPS relevance, AMZN tumbled a wee bit more.

     

    Of course, a "feel good" PR brings an automatic check of AMZN's current PER.
    Or may be not.

     

    Did you make that enlightening wee check to-day?
    11 Apr 2014, 05:48 PM Reply Like
  • MarketLost
    , contributor
    Comments (2917) | Send Message
     
    @Budavar,

     

    <<Each day AMZN stock tumbles, Bezos dreams up another "feel good" PR, methinks.>>

     

    Except he doesn't announce the real "feel good PR", which is that Amazon just made 8% net margins.
    11 Apr 2014, 06:16 PM Reply Like
  • MarketLost
    , contributor
    Comments (2917) | Send Message
     
    I'm guessing Amazon will be selling this at a loss, too?
    11 Apr 2014, 06:10 PM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1401) | Send Message
     
    But think of all the revenue growth ...
    11 Apr 2014, 09:04 PM Reply Like
  • Buyandhold 2012
    , contributor
    Comments (2812) | Send Message
     
    Maybe I'm just old and crotchety, but I have to say that I am sick of technology. I see people running around like chickens with their heads cut off, some technological gadget or other sticking out of various bodily orifices. I'm 58, not exactly ancient, but frankly I don't want to be constantly "in touch" through technology. I want to be left alone to have some peace and quiet. I want time to meditate. I miss the good old days when every house had one rotary telephone without an answering machine. If someone called the house and no one picked up the phone, the person would call back later.

     

    The irony in the whole situation is that everyone seems to be frantic to constantly communicate with other people, yet very few people have anything particularly urgent or life altering to say. The result is a constant cacophony of noise.

     

    I'm going into a quiet empty room now. I'm going to get into the lotus position and meditate.
    11 Apr 2014, 10:43 PM Reply Like
  • omnimoeish
    , contributor
    Comments (487) | Send Message
     
    Some truth here, but I can say I wouldn't have half as many relationships as I do without texting. I have some friends that I just text and rarely interact with in real life. To each his own.
    12 Apr 2014, 11:28 PM Reply Like
  • Budavar
    , contributor
    Comments (1387) | Send Message
     
    AMZN stock, not to be confused with Amazon, the company, keeps reminding me of the short Grimm fairy story about two weavers =
    here I recite from memory it's Wikipedia's page =
    who persuade the Emperor they can create a fantastic outfit worthy of royalty but invisible to the el stupido proletariat. As he parades struttingly, a child cries out

     

    "Look, he wears nothing!" Nothing at all...

     

    Now we have the new gurus who persuaded the crowds =

     

    famously described in a 1636 classic about the infamous tulip mania as
    suffering from "extraordinary delusions" + "madness",

     

    with irreverent language that PER really are irrelevant for AMZN =
    multiple puns intended indeed.

     

    Now this 90 year young child has cried out = profits do matter. So did a few others. AMZN stock crashes through both the 100 + 200 day moving average lines (courtesy Yahoo tech charts) reinforced by above average daily trading volume.

     

    See for yourself.

     

    Translation = AMZN is in a free fall.

     

    Then I checked the PER - still over 500 !!!
    Yeah, The Emperor has scanty profits.

     

    Good grief! Where will all this end ??????????
    11 Apr 2014, 10:58 PM Reply Like
  • Budavar
    , contributor
    Comments (1387) | Send Message
     
    (Here is the conclusion of above note)

     

    Then I noted an observer has arrived at a fair value for AMZN stock =
    somewhere below 100...
    11 Apr 2014, 11:26 PM Reply Like
  • glenmoody
    , contributor
    Comments (44) | Send Message
     
    if Bezos will change his name to Jobs, the stock will shoot upward.
    12 Apr 2014, 01:36 AM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1401) | Send Message
     
    why? because apple sold iPods, iPhones, iPads, and Macs at break even?

     

    If AMZN had AAPL valuation during its early 2000s growth phase, it might be worth high double digits. With current AAPL valuation, AMZN would trade under 20.
    12 Apr 2014, 11:55 PM Reply Like
  • jakoba
    , contributor
    Comments (345) | Send Message
     
    Try instead and compare the price/sales ratio. Which company is growing revenue the most? Which company is growing gross profit the most? Which company invest most into the future?
    13 Apr 2014, 05:59 AM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1401) | Send Message
     
    Have you compared p/s for WMT and TGT? In any case, it really doesn't matter that much since AMZN sells tons of SKUs that are not profitable which WMT, TGT do not (and certainly not AAPL). The thought that someone would compare p/s between AAPL and AMZN is completely laughable.

     

    Re gross profit .. this is completely meaningless when AMZN claims AWS is 100% gross profit. Btw, i guess AWS will still be 100% gross profit after 50%+ price cuts? How will that impact NET margins for AWS?

     

    In the long run, the only metric that matters is NET INCOME... which has been falling for AMZN past few years.

     

    As much as I admire Paulo's research, the lack of basic financial and accounting knowledge of AMZN longs presents way better bear case.
    13 Apr 2014, 11:19 AM Reply Like
  • jakoba
    , contributor
    Comments (345) | Send Message
     
    I don´t think you can compare WMT with AMZN. AMZN has more in common with AAPL than WMT. For one: AMZN is part of the Nasdaq, WMT is not.

     

    That´s a bit like comparing GM to TSLA or something like that. If you look only at P/E then maybe Tesla should be worth $10 not $200 to be on par with AAPL (or $8 to be like GM), and Solar City with declining and negative earnings should be worth $0.

     

    AMZN´s 12 month expected earnings growth is far higher than TSLA´s anyway, and higher than most companies, with EPS expected to grow 229% next 12 months (vs 129% for TSLA), according to CNBC.

     

    Also I don´t agree that the p/e ratio is necessarily the best indicator for long term performance. Many suggested that Apple was undervalued at $700 based on P/E, as they earlier did with Research in Motion, Nokia and many other companies.

     

    The truth is that for long term performance, price/sales is probably a better indicator. At least it is shown in the book «what works on wall street» that for larger cap stocks between 1950 and 1994, price/sales was a better indicator than price/earnings.

     

    I should say that I do not invest in AMZN at the moment (I may buy a small position tomorrow and accumulate if it goes lower), as I find the whole US stock market still a bit overvalued. I just don´t like people saying so much negative things about what I consider one of the best companies in the world, that does what a company should ideally be doing: invest profits into new ventures, take chances, praise innovation, think long term etc.
    13 Apr 2014, 12:34 PM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1401) | Send Message
     
    "AMZN is part of the Nasdaq, WMT is not." holy crap .. you actually think the exchange where stock is registered is relevant? Versus what the companies sell? Is TWTR more like WMT since it's also NYSE listed?

     

    I can't make this stuff up ...
    13 Apr 2014, 12:51 PM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1401) | Send Message
     
    re price/sales. Imagine 2 companies. Company A has X sales across its lifetime and total net income of 0.1X. Company B has 5X sales but total net income is zero. You think B is more valuable?
    13 Apr 2014, 01:49 PM Reply Like
  • jakoba
    , contributor
    Comments (345) | Send Message
     
    Wow, so many negative comments about Amazon just for coming up with a new type of smartphone - different than all the others out there that looks more or less the same, from one company to the other, from one flagship device to its next iteration (i.e. iphone, galaxy).

     

    Amazon is a highly innovative company with R&D budget of a whopping $6.5B last year (four times more than in 2010) - 40% more than AAPL used. I´m thinking about all the amazing stuff they created past years with a much much smaller R&D budget, what can we not expect now? Something truly revolutionary?

     

    The stock is down 25% from the peak, tech has taken a big beating recently (Nasdaq down 7% past month), and may rebound. If so, AMZN should follow.

     

    Typically a stock will go up leading up to the launch of a new product, and this will likely happen with AMZN too.
    12 Apr 2014, 04:37 AM Reply Like
  • yankeesgiants
    , contributor
    Comments (2) | Send Message
     
    will this amazon phone connect to Globalstar's (OTCQB:GSAT) satellites for WiFi quality speeds all over the country? I know Amazon was supposedly testing the satellites and the network last year.
    12 Apr 2014, 05:30 AM Reply Like
  • Gary J
    , contributor
    Comments (5792) | Send Message
     
    If it works in the Amazon ecosystem great! If it does not sell the business, the patents and move on. No big deal.

     

    Another good Amazon move.
    12 Apr 2014, 07:01 AM Reply Like
  • MrVincent
    , contributor
    Comments (257) | Send Message
     
    I am beginning to wonder about Amazon. Grocery delivery and now this. I might stop using them and just buy local to support my community.
    12 Apr 2014, 01:03 PM Reply Like
  • ReligiousWacko
    , contributor
    Comments (1401) | Send Message
     
    you forgot about drones and streaming media !

     

    i honestly wonder if Bezos has gone insane ... but most likely its just diversion/PR stunts before selling more equity/debt.
    12 Apr 2014, 01:39 PM Reply Like
  • MrVincent
    , contributor
    Comments (257) | Send Message
     
    I am beginning to wonder about Amazon. Grocery delivery and now this. I might stop using them and just buy local to support my community.
    12 Apr 2014, 01:03 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs