This page has been archived and commenting is disabled.
Amazon's Q1 Results Explained In Six Simple Charts
Moments ago Amazon reported its latest numbers which, as one would expect, emphasize the future and the profit potential one, two or more decades in the future, instead of highlighting the present and certainly the recent past. Because, neither the present nor the recent past are pretty.
In a nutshell: in Q1 Amazon posted a tiny beat on revenues, with Q1 sales printing at $19.7 billion compared to $19.4 billion estimated, however this is as good as it went. The problem as everyone knows for Amazon, are its margins. And in Q1 operating margins tumbled once again, this time to 0.7% (see chart below) which in turn resulted in operating income of only $146 million, well below the $200 million expected. And the cherry on top: AMZN guided to a Q2 operating loss between $455 million and $55 million, compared to the estimated profit of $210 million. Oh well, any decade now.
Here are Amazon's result in 6 simple charts.
First, total employees and worldwide revenue growth:
Quarterly operating and net income by quarter:

And Amazon LTM operating margin. It just printed at its all time joint low:
Quarterly operating margin:
A historical snapshot of just the first quarter across the past five years:
And the punchline: Q1 margin. No commentary necessary
- 26210 reads
- Printer-friendly version
- Send to friend
- advertisements -







The stock will up 10% tomorrow because Bezos rubbed his bald skull counter clockwise which is good luck.
Well, at least it looks like a controlled "soft-landing" on zero.
Valuation - yes, ridiculous.
But it IS impressive that a company generating revenue of $74.5bn/yr STILL grows at above-20% levels.
That reminds me of the company that was loosing money on every sale, but stated that they'd make up the shortfall on increasing volume. :)
That reminds me of the company that was loosing money on every sale, but stated that they'd make up the shortfall on increasing volume.
The Bezos school of economics?
"loosing" is not the same thing as "losing"
Don't they teach you Americans how to spell?
I could be a 200 billion company and grow 100% if I sold gold now at $1000. After the start up phase, revenue means nothing compared to profits. This generation has gone insane.
yes, its the new wally world..... Just keep my tax free tp coming bitchez!
commoditization of EVERYTHING.
before you know it, we may even commoditize the human experience.
Hmm, now I understand why Amazon Prime is going up from $79/yr to $99/yr.
they'll make it up on volume ... of employees
You mean drones
"Amazon.com, Inc. (AMZN) Revenue Beat Shows Strength In Retail" It's all about the narrative.
Funny. as I was reading the article I was wondering how the propaganda media was going to spin it, You provided the answer.
Unicorns everywhere one looks.
When the fuck do they start selling sex robots...yum
LOL
And selling fudge.
Really good chocolate fudge, with nuts.
must be flying on these "stellar" numbers...
<---Winning on thin ice...
<---Winning on wheat thins...
Looks like a buy to me, as long as we apply the first law of bullshit:
X (amazon stocks in the this case) + bullshit = $ ^ bullshit.
Non-GAAP. For the mother fucking win.
Given the amount of usage it gets, at some point they're gonna have to drop the "non" part, as it seems to be more and more accepted, every day.
Yes, let's dilute accountability even more. It's only words.
GANAP?
Generally Accepted Non-Accounting Practices?
GNAAP - Generally Non-Accepted Accounting Practices
fixed that for ya.
GAMIUAYGAP?
Generally Accepted Make It Up As You Go Along Practices.
GALP?
Generally Accepted Lying Practices?
FAAP? CAAP?
Fraudster Accepted ...
Conman Accepted ...
BMAAP
Bernie Madoff Approved Accounting Principles
Soooooo........this is a sign of the recovery?
I just tried to return a physical book purchased on Amazon. They said, no need to return, and here's your refund. What a country! I love this company. I do have Amazon Prime. It's like an epic stream of free Siht for $99/year!
Bought a keyboard for a Nexus 7. They sent one for Nexus 11 or 13 or something. Didn't fit the case.
I said I need to return and here's what you should have sent. They sent the correct thing and said trash the old one. No need to return.
I gave it to a neighborhood kid. He Ebayed it.
He rehypothecated it.
And it is now supporting about $4 billion in Chinese construction loans.
pods
Wow, talk about a slim profit margin!
.....it was due to the weather....
The shipping costs were more than the product was worth.
Agreed. I love Amazon. But I wouldn't invest in them.
I invested right before the crash @ 90. Got spooked and dumped at 60 and never went back in. :(
Time for you to get Amazon Prime, and seek your revenge.
Yep like I would bang ur avatar, but wouldn't marry it
It is easy to fall into the trap of loving Amazon, as I did as well in the very beginning. Wow, everything is cheap!
However, when you consider the broader impact it has has had, not only on the creative industry, but the entire ecosystem of distribution, record shops, local booksellers, etc, a loss has been suffered by society. It may have been technologically inevitable, but Amazon certainly expedited and exacerbated the overall demise.
Once thriving small businesses that many people now miss, were replaced by a giant Wall Street financed behemoth. Most artists, writers and other creative types whose minuscule margins are not subsidized by hedge funds hate it.
TBTF
It is hard to see why Amazon has any fans when you consider how they abuse and exploit the brick and mortar stores that line streets throughout America. These are the stores that employ our family members, support little league teams in the community, and add value to our lives. These stores build or lease space, buy supplies from the other local businesses, and pay both sales and real-estate taxes. While Amazon sends out the signal that their customers are smart, forward thinking, and upscale they exploit America and have an evil side, this is a side we should and must recognize.
http://www.deviantart.com/
Go then, and purchase sumthin'...
I forget, was the loss the overpriced music from shit musicians or the retail model from top to bottom?
The stupid sheeples will willingly cut their own throats in pursuit of a "bargain". I try to explain it to them and they simply do not care.
Funny thing. Land premiums should be collapsing. Nope. Not happening. Gee, I wonder why?
Over here, our govt/media propaganda machine blames the collapse of retailing on a 10% GST that doesn't apply to online purchases. Well, that explains a 10% discount. What about the other 50% ? Good thing the sheeps are crap at maths.
Hmm... this is good intel.
Right?
Now, what happens if you get no returns? 100% sell through, that's what. And we all know that sell-through is what really counts to probey investors and audited financial statements and sales analyses. So, just keep it, on us, and here's your money back.
FREE SIHT ARMY STRIKES AGAIN!
Yglesias was right - It's a charity run by investors for the benefit of consumers. I bought an xbox360 from them 2 years ago. They shipped me 2 units by charged me for 1 (300 a piece - only wanted 1). I called in to tell them I wanted to ship one back because they sent me too many.
They paid for the shipping for me to mail it back - and then gave me a 300 credit for it, effectively giving me an xbox360 for free.
I also have an amazon prime student membership at the stupidly low student rate because all you need ia .edu address, which my alumni one works.
Ridiculous company.
That said, it is damning that FB is worth more (or about the same) by mkt cap as amazon. One is completely useless - amazon provides much more consumer value.
?
Starbucks just hit their estimates too, "EX-ITEMS"
I'd be looking pretty good on paper too EX ITEMS
You scratch the mortgage pmt, the food cost, fuel costs, car pmts off the books and I look pretty good too
This is such BULLSHIT
...those would be the non-recurring, but quarterly, charges?
One industry's bullshit is the same industry's bonus.
They will probably be the largest company, market cap, at some point in the future, Bezos is nuts!
It's because they treat the order pickers too well. A 30% pay cut for all happy warehouse workers should make wall street robots jizz all over the rich, mahogany floors.
Even though the first chart is deceptively designed to make it look bad, employee growth is still well below revenue growth, so they should be getting economies of scale.
There is most likely something else contributing to the lower margin. Not going to read their 10Q because I do not really care.
So why the extraordinarily high multiple of earnings then? Can someone try and justify?
Because... reasons!
duh
something......something.....snow....something....brrrr.....
0.7%.........sufferin kittens,
"Earnings season" is a mere blip to show a sham semblance to reality.
*Normal sevice will resume shortly, apologies for the intrusions*
bonus time again so soon?
You clearly don't get it, Tyler. AMZN is a margin expansion story. First, contract the margins almost down to zero, then cut back CapEx and expand them all the way back to 2%. Why, if they were to go from 0.1% to 2%, that would be a 20-fold increase in margins!
Now what kind of multiple would you put on that!?!?
I think they should apply to the PUC and get licensed as a public utility. They serve to depress prices throughout the economy and thus should be viewed as a public good. Guarantee them a revenue stream and profits and let them expand to selling everything in the world.
.7% Q-1 margin? Ho Li Fuk!
BTFATH-BTFD-BUY BUY BUY > I'm Jimmy "tool time" Cramer and I endorse this statement.
sells lots of stuff for little profit.
Margin compression right on schedule, just like I'd been predicting... We'll only see more and more of this: Amazon won't have to sit all by itself.
you just don't get it...Bezos is saving the work from capitalist pigs...he wants to run the world largest non-profit organization. they'll never go out of business but just never make any money. i can using there services...but owning their stock? just make sure you lock in those profits.
.7% of 19.4 billion is $135,800,000.00. Every three months. I wouldn't signal the vultures just yet.
I think that the point is that there's a downward trend happening, and that .7% is sloping even lower, so "every three months" cannot be a given. I believe that it's said that he who panics first panics best? Waiting too long and it's going to be a bit problematic...
Now that's economic recovery!! LOL
How to....
...create a matrix like environment for the proles?
1) Supply Devices:
- Apple
2) Supply Movies:
- Netflix
3) Provide Stuff:
- Amazon
- Ebay
4) Provide Food & drinks:
- GrubHub
5) Make everybody feel "in control", "active" and "social":
- Google
- FB
- Twitter
- Linkedin
... and Bob's your uncle
So all of these companies are excessively overvalued. What does that tell us?
Somebody out there must believe (or want?) that we will all live a matrix-like life in the future.
I on the other hand love Amazons! Tall ones with big titties!
I love Anyonez...Anyonez with big titties
starman - learn about real amazons. they are tall. or short. but it is 'tittie'. sometimes the stupidity and lack of education amongst our american children stuns me.
western world has been reading the classics for almost 2,000 years. but, then again, today we have kardashians, so why bother with the test of time.
Sell when amzn has positive Earnings, until then the fantasy must go on. It's all about the 'future'.. Don't u know.
As I listened I heared the sound of thousands of AMZN employees crying out for help!
Just went RED after hours- that call must be going well :)
Me thinks collecting state sales taxes hasn't helped their bottom line much. Next up, federal excise & vat. Europeans put up with it, why not us?
Time for a govt. bailout.
Don't be impressed with the hype and spin. As someone who is in business and works with numbers I'm unimpressed! Words like "evolving" are used to describe Amazon's business model, a better word might be undefined. Regardless Amazon rolls on. Pointing towards gaining synergy as they continue to buy companies, some unproven. The revenues from these companies add to their growth but still no profits exist.
Does this growth mask a weakness at their core? If they are indeed a distribution company their stock should be trading at around 18 times earnings. When you look for a P/E ratio on Amazon you find NA because the company makes no money. Another key weakness is that new competition can now cheaply and easily replicate the most profitable parts of Amazon and cherry pick much of their future potential. The bigger they are, the harder they fall, it is only a question of time. More on this subject in the article below.
http://brucewilds.blogspot.com/2013/10/amazon-not-answer.html
Back up the truck baby! Gotta load up on AMZN - bad news is always good news in this market - right?
Just wondering if UPS' fuel surcharge is hampering margin improvement.....of course that would be a one time, non-recurring event.....
....just looked it up and it is now 7.5% which has to impact their 'prime' biz.
In November of 2013 it was announced the USPS made a special deal with Amazon to do Sunday deliveries in two cities? This is wrong on several counts. The first and biggest reason is that the USPS is an extension of the US Government and a money losing one at that.
Another problem is this hurts all the smaller mom and pop businesses and brick and mortar stores in a community. This makes government an alliance to a company built on exploiting those who provide jobs to us on the most basic level. For more on this unholy alliance see the article below.
http://brucewilds.blogspot.com/2013/11/usps-and-amazon-another-unholy-al...
The Q1 charts reminds me of my boner when staring at Joan Rivers
The first chart is crap. It's misleading to juxtapose nominal numbers against rate of change.
Amazon is not currently in the business of making money. It's in the business of making market share and Bezos is more than willing to go break-even to do it. You can argue about whether this strategy will pay off, but it makes no sense to criticise them for not doing something they're not trying to do.
Wait... Do I hear 2000 calling? I do I do!
I bought 2 gopeds (the best ones that go about 35 mph) for about $900 apeice from Amazon. One had a few parts missing (maybe $10 worth at the most). I called them up. They gave me acredit for a whole goped! Unbelievable!