- "We have a long-term view ... We’re not trying to optimize for short term profits," states Amazon (NASDAQ:AMZN) CFO Tom Szkutak on the Q2 CC, repeating a mantra his company has uttered in some form for years. Judging by the reaction to the company's EPS miss and guidance for a sizable Q3 op. loss, investor patience seems to be wearing thin.
- Szkutak admitted Amazon Web Services' near-term growth has been hurt by an ongoing cloud infrastructure price war with Microsoft and Google - while North American "Other" revenue was up 38% Y/Y, it fell 3% Q/Q, and Y/Y growth decelerated from Q1's 60%.
- He also suggests Amazon's Q3 bottom line will be pressured by a "significant" increase in video content spend. The company plans to spend $100M on original programming alone, as it tries to counter Netflix's big content investments and keep Prime renewal rates high.
- On the bright side, Szkutak says Prime subscriptions are still growing well following this year's $20 price hike, and that Q2 subscriber adds topped year-ago levels (no specific numbers, as usual). CIRP survey data appears to back him up.
- Regarding China, he states Amazon has "a lot of interesting things" planned, and will continue investing in the Middle Kingdom. Alibaba remains the Chinese e-commerce market's 800-lb. gorilla.
- Q2 results, guidance/details.