Feb. 18, 2014, 7:13 PM
- "It's almost like going into a room and them putting a gun to your head and showing you your future," says an exec at ad giant GroupM about Amazon's (AMZN) ad sales approach. Another industry exec talking with Ad Age says Amazon's lack of a personal touch when courting Madison Ave. hurts its success.
- After interviewing "a dozen people close to the companies," Ad Age suggests both Amazon and Apple (AAPL) are experiencing growing pains as they try to grow their ad ops. While advertising is largely a sideshow for Apple - Tim Cook has said iAd's main goal is to help developers make money - Amazon wants to use its oceans of data to mount a challenge to 800-lb. gorilla Google, as well as drive more e-commerce activity.
- Nonetheless, Amazon has been cautious about sharing transactional data with ad agencies. One exec says Amazon hasn't agreed to a request to "divulge data about what's in shoppers' carts to inform ads." Another suggests the company could be more proactive in providing case studies.
- Last year, eMarketer estimated Amazon had 2012 ad sales of $609M, and forecast 2013 sales of $835M.
Feb. 13, 2014, 3:00 PM
- eBay (EBAY -0.1%) is open to taking on more debt as long as doing so doesn't affect its credit rating, says CEO John Donahoe. The remarks come after eBay, which has only $3B in U.S. cash, added $5B to its buyback authorization.
- Altogether, eBay had $14B in cash/investments at the end of 2013, and $13.4B in debt.
- Donahoe reiterates his opposition to Carl Icahn's call to spin off PayPal, but suggests he could eventually change his mind. "If and when synergies run their course we will be rational in the same way we were rational with Skype."
- For his part, PayPal co-founder/Tesla CEO Elon Musk has told Forbes (in a cover story about PayPal) he backs a PayPal split. "It doesn’t make sense that a global payment system is a subsidiary of an auction website. It’s as if Target owned Visa or something."
- Forbes' story highlights the culture clash between PayPal and eBay, as PayPal chief David Marcus tries to make the payments giant more agile and mobile-focused. Marcus: "It’s a 13,000-person company where we’re changing everything and rewiring the whole culture … At large companies you always find someone with reasons not to do something."
- Meanwhile, Donahoe tries to tone down expectations for eBay's Now same-day delivery service (relies on retail partners). "This is not a major independent business line we want to grow." Amazon (AMZN +2.1%) might be happy to hear those remarks.
Feb. 12, 2014, 9:47 AM
- Amazon (AMZN -1.6%) has been cut to Neutral by UBS. The firm cites Amazon's soft Q4 top-line performance, and a CIRP survey that indicates only 58% and 24% of Prime subs would respectively renew following price hikes of $20 and $40 (currently under consideration).
- Intuit (INTU -5%) has been cut to Underweight by Evercore following its FQ2 guidance cut.
- Veeco (VECO +3.1%) has been upgraded to Outperform by Credit Suisse ahead of its Feb. 19 Q4 report.
- comScore (SCOR -0.8%) has been upgraded to Outperform by Northland following its Q4 beat.
- Itron (ITRI +5.5%) has been upgraded to Buy by Needham ahead of today's Q4 report.
Feb. 6, 2014, 3:33 PM
- The NRF forecasts retail sales will rise 4.3% in 2014 to improve on last year's gain of 3.7%.
- The association forecasts strong household and business confidence will support an uptick in spending. The impact of higher healthcare costs on consumers and companies is factored into the NRF view.
- Online sales (AMZN, EBAY) are expected to increase by 9% to 12% this year.
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Feb. 6, 2014, 10:26 AM
- Amazon (AMZN +1.2%) has 10 new pilots debuting on Prime Instant Video today as the company leans on crowdsourced viewer opinion before greenlighting projects.
- The mix of pilots includes dramas, comedies, and kids shows.
Feb. 1, 2014, 1:11 PM
- Retail watchers think an increase in the cost of Amazon (AMZN) Prime to $119 per year will fly with most consumers as they crunch the numbers on the wide benefits they will receive with a continued or new membership.
- The company has the ability to boost streaming options and Kindle offerings if initial churn rates look discouraging, notes IBISWorld.
- If things go smoothly for Amazon Prime at the $119/year level, revenue could soar, according to analysts. The mid-point of 6 different forecasts puts Prime gross profit at just a shade below the $500M/year mark.
- Previous: Sell-side defends AMZN post-earnings
- Earnings call transcript: AMZN tips $20-$40 Prime price hike
Jan. 31, 2014, 2:38 PM
- Though its shares have tumbled, Amazon (AMZN -9.9%) has received an equal number of PT hikes and cuts (7 apiece) after missing Q4 estimates, offering soft Q1 guidance, and stating it's weighing a Prime price hike as it contends with heavy usage and still-surging fulfillment spend. S&P is the only firm to change its rating, cutting shares to Sell.
- Benchmark remains optimistic about long-term margin expansion, and believes Amazon will still deliver 32% OIBDA growth in Q1. The firm chalks up Q4's major slowdown in EGM revenue growth (23% vs. 29% in Q3) to aggressive holiday season electronics discounting.
- Cowen estimates a Prime price hike would produce $380M-$760M/year in gross profit at current subscriber levels. Morgan Stanley believes the churn impact of a hike would be limited, given its belief "Prime remains one of the best values around."
- Susquehanna likes the fact gross margin rose again. Evercore thinks Amazon's paid unit growth slowdown (25% vs. 29% in Q3) is "largely temporary," and have much to do with Amazon's international media sales being behind its U.S. ops in transitioning to digital.
- Amazon mentioned on its CC (transcript) active accounts rose by 13M Q/Q to 237M. 3rd-party sellers accounted for 39% of paid units vs. 40% in Q3.
Jan. 31, 2014, 9:09 AM
Jan. 30, 2014, 6:21 PM
- Amazon (AMZN) states on its Q4 CC it's thinking of raising Amazon Prime's price for U.S. subs (currently $79/year) by $20-$40/year.
- The remark follows a 2013 in which Prime, from all indications, saw tremendous growth; Macquarie recently confirmed Amazon now has 20M+ Prime subs. Amazon's October decision to hike its free shipping minimum by $10 to $35 may have led to a late-year pickup in Prime sign-ups.
- Though off their AH lows, shares continue trading lower in response to Amazon's Q4 miss and largely below-consensus revenue guidance. North American and international revenue growth rates of 26% and 13% Y/Y represent slowdowns from Q3 levels of 31% and 15%.
- Price hikes or not, Amazon continues to spend aggressively: Fulfillment spend rose to 11.4% of revenue from 10.6% a year ago. Marketing spend rose to 4.4% from 4%, and tech/content spend rose to 7.2% from 6.3%. On the other hand, gross margin rose to 26.5% from 24.1%.
- Amazon Web Services remains a bright spot: Amazon's North American "Other" revenue (dominated by AWS) rose 16% Q/Q and 52% Y/Y to $1.17B.
Jan. 30, 2014, 4:26 PM
- Amazon (AMZN) saw revenue growth decelerate in Q4 from the previous two quarters (Q3 24%, Q2 22%).
- North America sales rose 25.9% Y/Y to $15.33B, while International sales were up 12.8% to $10.26B.
- The company saw a nearly even growth rate between media and electronics in North America.
- Q1 guidance is below expectations. Sales are projected at $18.2B-$19.9B and the company sees an operating gain/loss of -$200M to $200M.
- AMZN -9.9% AH
Jan. 30, 2014, 4:08 PM
- Amazon.com, Inc. (AMZN): Q4 EPS of $0.51 misses by $0.18.
- Revenue of $25.59B (+20.3% Y/Y) misses by $470M.
- Shares -7.4%.
Jan. 30, 2014, 2:24 PM
- TechCrunch reports Amazon (AMZN +4.4%) is developing a P2P payments system that would fully bypass banks and payment processors, and represent a further escalation of its challenge online payments colossus PayPal (EBAY +2%).
- Amazon launched a payments solution for 3rd-party merchants in October, and is reportedly also working on a Kindle-based checkout system for retailers. TechCrunch observes a P2P system could help Amazon reach "unbanked" customers; PayPal has already made some efforts to win their business.
- Separately, re/code reports PayPal is "pitching" Apple on offering white-label services (fraud detection, processing, etc.) for its planned mobile payments service. But two of the site's sources state it's unlikely Apple would have any need for PayPal.
- eBay shares sold off on Monday in response to a WSJ report about Apple's payments service. PayPal handled $27B worth of mobile transactions in 2013, up from $14B in 2012.
- Both Amazon and eBay's shares have joined a Facebook-fueled Internet stock rally.
Jan. 30, 2014, 12:10 AM| Jan. 30, 2014, 12:10 AM | 2 Comments
Jan. 29, 2014, 6:11 PM
- The WSJ reports Amazon (AMZN) is working on a checkout system for physical retailers that would rely on Kindle tablets and (possibly) credit-card readers, and leverage technology and talent from recently-acquired payments startup GoPago. A launch could happen "as soon as this summer."
- Such a move would push Amazon into a crowded mobile payments space that already features Square, PayPal, Groupon, Intuit, and a slew of other upstarts, as well as incumbent point-of-sale hardware vendors NCR and VeriFone (PAY). Apple might soon enter the market as well.
- In addition to competition, Amazon might have to contend with retailer wariness about partnering with a competitor. Sources state Amazon is trying to reel merchants in by giving them the chance to offer promotions/discounts on its site.
- Amazon is also reportedly thinking of cross-selling merchants complementary services such as site development and data analysis. If major retailers adopt the system, it could provide Amazon with valuable user data about offline purchasing activity.
Jan. 29, 2014, 5:35 PM
Jan. 28, 2014, 1:52 PM
- A Westfield shopping mall in London plans to offer a premium service to consumers that will allow them to try on clothes they purchased online. A bad fit or an unpleasing style can earn a customer a credit back on the spot.
- Online shoppers receive a text message when their item has arrived at the mall and is ready to be sampled.
- The development looks interesting with the traffic to U.S. malls in a slump. No great surprise, but Amazon (AMZN +1.6%) is supporting the service.
Amazon.com, Inc. provides online retail shopping services. It provides services to four primary customer sets: consumers, sellers, enterprises, and content creators. The company also provides other marketing and promotional services, such as online advertising and co-branded credit card... More
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