Amazon 4Q & FY numbers - strong growth from AWS


Amazon reported numbers after hours, this was for the "holiday" quarter - Fourth Quarter Sales up 22% to $43.7 Billion. The sales number fell short of expectations and guidance, as much as 1 billion Dollars or around 2 and a bit percent relative to what the market expected. The company reported profits ahead of consensus, that matters little when you are owning the stock for the sales growth. There is a major contributor over the last few years, that being AWS (Amazon Web ServiceS). In case you needed a refresher - Amazon AWS update.


No queues, no checkout tills


When you think about Amazon, you think about a company that is completely online, you think about a company that has no store presence and is at the cutting edge of retail with their massive fulfilment centres. That is how I think of Amazon. Well, wait. That is about to all change. Except, not in the way that you may have thought. There may still involve very few people in these stores. The technology being touted is something called "Just Walk Out". Here is an introductory video that Byron sent to the WhatsApp group, introducing Amazon Go, with the pay off line of "No lines. No Checkout. (No, Seriously) - The world's most advanced shopping technology. You see that the clip, a day old, has had 1.5 million views already and counting at a rapid rate.


Amazon AWS update


Amazon have just finished what is called the AWS Re:INVENT conference. I don't blame you for not knowing what that is, we will try our best to explain. It is 32 thousand folks crammed into a giant auditorium (this time in Vegas) with the web service business chief (Andy Jassy) opening with examples of how the services are used, and then away we go. Get togethers for all the people there, plus another 50 odd thousand watching online, in part enabled through the backbone of Amazon Web Services (which is what AWS stands for). Don't feel confused, this is all rather new for all of us, this business after all is only ten years old, and is half the age of the parent company, Amazon.


Amazon 2Q blows estimates away


Amazon reported numbers after-hours yesterday. This is an incredible business too. The founder has pretty much tried everything, you may recall the infographic from the Visual Capitalist - How Jeff Bezos Built his Amazon Empire. There are tons of things that the fellow has started and failed at, it is better to have tried and failed rather than to have never tried at all, as they say in the classics. Straight into the new age retailer's results - Announces Second Quarter Sales up 31% to $30.4 Billion.


Amazon 1Q numbers - AWS showing strong growth


As we chatted about last week, released their 1Q 2016 numbers and they smashed expectations pushing the stock back to record highs. Here are the numbers, Revenue up 28% to $29.1 billion, operating income up 331% to $1.1 billion and Net Income is $513 million from a loss of $57 million. The net income number is not of huge importance, as Amazon is spending most of the cash that comes through their front door on infrastructure development.


Amazon 4Q and full year numbers


Jeff Bezos announced another stellar year of growth for on Thursday. As Sasha wrote yesterday, the market was expecting more. Headlines on Friday morning were along the lines of "Amazon disappoints". I think sometimes people get too focused on the expectations and lose sight of the bigger picture. Full year revenues grew by 20% to $107 billion, putting them into an exclusive club of companies. To put their revenue growth into perspective, the revenue growth of $18 billion last year was more than the total revenue of Visa for 2015.


Record numbers, better expected


In other corporate related news, Announces Third Quarter Sales up 23% to $25.4 Billion, which included in that is a rare profit, 17 whole cents per share for the quarter. Mr. Market had expected the fast growing company, that invests heavily in their business to not report such a profit, at best a really modest one. And whilst it is pretty insignificant in the short term (406 million Dollars operating income on revenues of 25.4 billion Dollars), it is a shift in the right direction. Comfortably above consensus and their own guidance.


Amazon Flex


This is pretty incredible. Want a part time job, want to earn 18-25 Dollars an hour? Or until the drones replace you, someone quipped on Twitter, then become a delivery person for Amazon -> Amazon Flex. What are you going to deliver via your own transport? Yes, your own transport. It turns out Amazon Prime Now packages, for those who really can't wait. You can work 12 hours a day, 7 day a week, earnings 2100 Dollars a week, or 109,200 Dollars a year, provided you work each and every day for 12 hours a day, presuming you changed that to 5 days a week, the annual salary would still be an acceptable 78,000 Dollars a year.


Amazon 2Q numbers


Last night after the market closed Amazon released their second quarter results. The stock in after hours trade is up 17% which gives Amazon a bigger market cap than Walmart! Walmart has revenues of $486 billion compared to Amazon with revenues of $89 billion. South Africa has a GDP of around $350 billion. This article gives a good comparison of the two companies - Amazon is now bigger than Walmart.


Amazon moves closer to drones


Amazon has been granted the ability to fly their drones, or more specifically as per the FAA website: Amazon Gets Experimental Airworthiness Certificate. It is pretty simple, as per the release: "all flight operations must be conducted at 400 feet or below during daylight hours in visual meteorological conditions. The UAS must always remain within visual line-of-sight of the pilot and observer. The pilot actually flying the aircraft must have at least a private pilot's certificate and current medical certification." That sounds pretty dumb. I would love to hear a pilots opinion on the matter.


Amazon full year and 4Q results


Amazon released their 4Q and full year results on Thursday last week, Announces Fourth Quarter Sales up 15% to $29.33 Billion. The company's stock was up 14% after the announcement because they made a small profit. Their EPS for the quarter was 45c compared to the 95c loss in the previous quarter.


No profits, no worries!


I have heard it being said that this is the company that does not make a profit, it is gearing up on massive infrastructure instead, taking their sweet time. Last evening post the market close, Announces Third Quarter Sales up 20% to $20.58 Billion. That sounds great, right?


The everything store does not have profit


Last week it was's turn to in the earnings season to release their results. I am busy reading the book about Jeff Bezos and Amazon, so the team here decided to leave the report for me now that I am back from the Cape.


Amazon breaking new ground again


Amazon have disrupted the book market again through their service called "Kindle Unlimited". The service gives you access to more than 600 000 books to read for a fee of $9.99 a month. This is great if you do a big amount of reading as the monthly subscription fee is about the cost of one book. The downside is that you won't find any recent titles or titles from the top 5 publishing houses.


The everything store


Over the last week Amazon has been in the news for a couple of things. The first is a dispute that is going on with a publishing house called Hachette Book Group over the pricing model of e-books. The basis of the dispute is over who controls the price and how the profits are split. The current model is where the publishing house gives wholesalers like Amazon a 50% discount on the retail price and then it is up to Amazon to set the price. The model that Hachette is fighting for is to have the publishing house determine the price and the profit margin of the retailer.


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