Oct. 24, 2014, 12:56 AM
- "Can you tell us or remind us what financial measures are important to you guys ... it's a little hard to see any of them making positive progress," asked Wolfe Research's Aram Rubinson during Amazon's (NASDAQ:AMZN) Q3 CC (transcript), just one of several pointed questions offered.
- Bernstein's Carlos Kirjner asked about weak international margins - international op. loss rose to $224M from $28M a year ago - and why international's growth (14%) has fallen far behind North America's (25%). CFO Tom Szkutak (again) chalked up Amazon's losses to growth investments, and gave little detail about growth other than to state it "has been softer across a number of geographies."
- BGC's Colin Gillis asked why North American media growth (+5%) was the lowest in years. Szkutak mentioned Amazon is seeing a demand shift from textbook purchases to rentals (could be a positive for CHGG), and that heavy discounting last year made for tough comps.
- Total media revenue rose 4% to $5.2B vs. 10% in Q2, and total electronics/general merchandise revenue 26% to $14B vs. 27% in Q2. North American "Other" revenue (mostly AWS) rose 40% to $1.34B, and returned to positive Q/Q growth (15%) following huge price cuts earlier in 2014.
- Other details: 1) $170M in charges were taken, largely related to the slumping Fire Phone. 2) Paid unit growth was 21% vs. 23% in Q2, and 3rd-party sellers made up 42% of units vs. 41%. 3) Gross margin rose 120 bps Y/Y to 28.9%. 4) Fulfillment, tech/content and marketing spend respectively rose to 12.4%, 10.8%, and 4.7% of revenue from 11.5%, 9.2%, and 3.9% a year ago.
- Shares finished AH trading down 10.7%, making new 52-week lows along the way. Not factoring post-earnings estimate revisions, they now trade for 1.2x 2015E sales.
- Q3 results, guidance/details, PR
Oct. 23, 2014, 5:42 PM
Oct. 23, 2014, 4:17 PM
- Amazon (NASDAQ:AMZN) reports another unprofitable quarter amid strong growth and a flurry of new device releases.
- North American revenue +24.9% Y/Y to $10.301B
- International revenue +13.6% to $7.712B.
- Media revenue +4.2% to $5.244B
- Other revenue +36.7% to $1.382B.
- Fulfillment spend +29.9% to $2.643B.
- Operating cash flow +15% to $5.71B.
- Guidance: The company sees revenue of $27.3B-$30.3B in Q4 vs. $30.9B consensus. A Q4 operating loss of between -$570M and -$430M is expected.
- AMZN -8.5% AH.
Oct. 23, 2014, 4:03 PM
Oct. 22, 2014, 5:35 PM
- ADES, ALGN, ALTR, AMZN, BAS, BJRI, BLDR, BMRN, CB, CBI, CERN, CLMS, CLNE, CNMD, CPWR, CTCT, CYN, DECK, DLB, DV, ECHO, ELY, EW, FET, FII, FLS, FSL, GHL, GIMO, HBHC, HUBG, HWAY, IM, INFA, JNPR, KLAC, LOGM, LSCC, MSFT, MTSN, MXIM, MXWL, N, NCR, NTGR, OLN, P, PACB, PCCC, PDFS, PEB, PFG, PFPT, POL, QLIK, RMD, RUBI, RVBD, SHOR, SIVB, SPNC, SRCL, SWFT, SWN, SYNA, VMI, VRSN, WOOF, WRB, WRE, WRI
Oct. 21, 2014, 2:13 AM
- Amazon (NASDAQ:AMZN) and Simon & Schuster (NYSE:CBS) have signed a multi-year contract over the price of e-books, a deal that comes as the online retailer continues tough negotiations with Hachette Book Group.
- Amazon has been in a brutal battle with Hachette since the publisher's contract expired in March.
- Negotiations with Simon & Schuster took about three weeks and closed two months before the previous contract expired.
Oct. 20, 2014, 9:28 AM
- Jefferies keeps Amazon (NASDAQ:AMZN) lined up as its top large-cap e-commerce stock pick.
- The investment firm thinks the company will beat estimates this week with its quarterly report and continue the momentum through the holiday season.
- A lush price target of $435 on AMZN is still in play from Jefferies.
- AMZN -0.4% premarket to $302.20.
Oct. 17, 2014, 2:26 PM
- Moody's calls the decision by CBS (CBS +2.3%) to move forward with a streaming service another step forward in the "transformation" of content delivery.
- The ratings agency thinks the product will be attractive to millennials and cord nevers, but is undermined a bit by not including NFL broadcasts.
- In an interesting pullout, Moody's predicts the service won't have a material impact on subscriber demand for SVOD concerns such as Netflix (NFLX -2.2%), Hulu, and Amazon Prime (NASDAQ:AMZN).
- Moody's also point out that content providers will have the ability to set restrictions on content delivery in order to maximize revenue streams. Disney's (DIS +2.6%) ESPN comes to mind.
Oct. 17, 2014, 6:58 AM
- Amazon (NASDAQ:AMZN) launches its grocery store delivery business in Brooklyn today in a slow roll-out in the region.
- Amazon Fresh is currently up and running in Seattle and a few California cities.
- The New York City region has several online grocery delivery upstarts already in operation - including Instacart, Peapod, and Fresh Direct.
Oct. 16, 2014, 6:12 AM
Oct. 15, 2014, 4:45 PM
- Internet stocks are selling off in AH trading as Netflix craters in response to its light Q3 subscriber adds and disappointing Q4 guidance, and eBay slumps after providing weak Q4 guidance and reporting only 6% Y/Y Q3 Marketplaces growth.
- Google (NASDAQ:GOOG) -1.6% AH. Facebook (NASDAQ:FB) -1.5%. Amazon (AMZN - taking share from eBay) -2.8%. Twitter (NYSE:TWTR) -1.9%. LinkedIn (NYSE:LNKD) -4.2%. YELP -1.4%.
- Internet ETFs: FDN, PNQI, SOCL
Oct. 15, 2014, 11:32 AM
- Netflix (NFLX -2.6%) slid a little lower after Time Warner announced HBO would become a stand-alone service sometime in 2015.
- Though it isn't clear how much of HBO's programming will migrate over to the OTT product, the mention of the "international possibilities" of a streaming HBO is enough to catch the attention of Netflix watchers.
- The development also has implications for Hulu (DIS, CMCSA, FOXA) and Amazon (AMZN -1%) which could end us as delivery partners or direct streaming rivals, according to Re/code.
- Pay-TV operators (CHTR, CVC, DISH, DTV) are in a bit of a box by the plan and may choose to play hardball with HBO.
Oct. 14, 2014, 3:31 PM
- Global growth, foreign-exchange, oil, and small caps are the subject of every client inquiry, says David Kostin. His team's recommendation: Buy "American exceptionalism."
- In Kostin's view, U.S. economy and corporate fundamentals are still strong, with economic growth expected by Goldman economists to be 3.2% next year, the fastest expansion since 2005. Europe is expected to grow just 1%.
- What his team likes are those stocks of companies which have a high proportion of domestic sales, plus sectors like Consumer Staples (XLP -0.1%) and Discretionary (XLY +0.7%) which stand to benefit from lower oil prices (plunging again today).
- As for small caps (IWM +0.9%), Kostin is wary, noting downward earnings revisions have boosted small cap P/E ratios even as prices have declined.
- The list of S&P 500 names capturing two or more of Kostin's themes: GT, GM, PCLN, AMZN, CMCSA, LOW, DG, TSN, ADM, CVS, AVP, WAG, PXD, HAL, JPM, BAC, SCHW, PNC, MS, C, GNW, LNC, MET, THC, AET, UNH, ESRX, HUM, WLP, BIIB, GILD, DAL, CMI, FLR, CRM, JBL, MA, FB, MU, FSLR, VMC, MON, T.
Oct. 14, 2014, 2:44 PM
Oct. 14, 2014, 10:48 AM
- The Google Shopping Express same-day/next-day delivery service has been renamed to Google Express. It has also added Chicago, Boston, and D.C. to its list of supported cities; existing markets include the Bay Area, West L.A., and Manhattan. Altogether, Google (GOOG +1%) says it now provides same-day to 7M+ people, and next-day to nearly 12M Northern California residents.
- The service (free on a trial basis until now) has been priced at $95/year. While that's only slightly less than Amazon Prime's (AMZN +1.2%) $99/year fee, Google charges no additional fee for same day/overnight delivery on most $15+ orders.
- Amazon charges Prime subs a $5.99 flat fee for same-day orders of up to 150 pounds. Its AmazonFresh service doesn't charge a per-order fee and covers the delivery of fresh/refrigerated items, but also costs $299/year and has a $35 minimum.
- Express has added 16 new merchant partners in recent months, including Barnes & Noble, Sports Authority, and PetSmart. Existing partners include Whole Foods, Walgreens, and Staples.
- Google's announcement comes a day after Eric Schmidt called Amazon Google's biggest search rival. Express could provide the Web giant with valuable shopping data that could help Amazon's rivals deliver better targeted ads on Google properties.
Oct. 13, 2014, 6:45 PM
- Amazon (NASDAQ:AMZN) will spend over $2.5B on streaming license rights and original content next year, up from $1.5B-$2B in 2014, estimates Bernstein. The company's 2015 revenue consensus is at $109.2B.
- Bernstein also reports a survey of 400 Prime subs found 60% of them used Prime Instant Video, and that 13% of those who signed up for Prime in the last year did so to get Instant Video (only 6% of older sign-ups did so).
- At those rates, the firm thinks Amazon will need to add 10M-20M additional Prime subs, on top of an estimated base of 42M, to justify its investment.
- Though unwilling to share details about its content spend (as with so many other things), several of Amazon's streaming deals have been reported to carry steep prices. Its HBO deal reportedly costs $300M+ over 3 years, and its Viacom deal $200M+ over more than two years. The e-commerce giant is also paying licensing fees for its ad-free Prime Music service.
AMZN vs. ETF Alternatives
Amazon.com Inc is an online retailer. The Company sells its products through the website which provides services, such as advertising services and co-branded credit card agreements. It also offerselectronic devices like Kindle e-readers and Fire tablets.
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