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Amazon Misses, Guides Lower, Sees Q4 Operating Loss; Shares Tumble
The latest Momo implosion as predicted:
- AMAZON.COM 3Q EPS 14C, EST. 24C
- AMAZON.COM 3Q REVENUE $10.88 BILLION VS EST. $10.95
- AMAZON.COM SEES 4Q SALES $16.45B-$18.65B, EST. $18.16B
- AMAZON.COM 3Q OPERATING MARGIN 0.7%
- AMAZON.COM sees 4Q operating income (loss) between $(200) million and $250 million, or between 142% decline and 47% decline compared with fourth quarter 2010
No, Paulson & Co. is not long.
And it just gets uglier:
From the earnings release:
The following forward-looking statements reflect Amazon.com’s expectations as of October 25, 2011. Our results are inherently unpredictable and may be materially affected by many factors, such as fluctuations in foreign exchange rates, changes in global economic conditions and consumer spending, world events, the rate of growth of the Internet and online commerce and the various factors detailed below.
Fourth Quarter 2011 Guidance
- Net sales are expected to be between $16.45 billion and $18.65 billion, or to grow between 27% and 44% compared with fourth quarter 2010.
- Operating income (loss) is expected to be between $(200) million and $250 million, or between 142% decline and 47% decline compared with fourth quarter 2010.
- This guidance includes approximately $200 million for stock-based compensation and amortization of intangible assets, and it assumes, among other things, that no additional business acquisitions or investments are concluded and that there are no further revisions to stock-based compensation estimates.
And as usual: the holders:
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CNBS says BTFD. Stocks are cheap, remember that.
I'm looking for stocks to get cheaper too before I'll start buying.
I'm no prophet, but I do like profit, and I'd dare say I'd add "a lot" to your cheaper, before I'd entertain buying into what may be the Japanese-esque 21 year/negative 88% (and counting) black hole.
Amazon has efficiencies and competitive advantages infinitely more plentiful than Brick & Mortar retailers and other online retailers, and even it misses.
I can hardly wait for the next CNBS anal-cyst to advise how this is the bottom, rather than a mere appetizer.
If Amazon is working off of these margins, Retail-geddon cometh.
Apple is now implementing a 'cut our prices' business model (officially) after seeing unit volume sales miss and 9% decline in same store sales, Amazon misses big, and NFLX loses nearly 1 million customers in a single quarter, and all I have to say is the MOMO crowd is going to relive 2008 with - leverage.
But the sell-siders will all rush onto CNBS & Bloomturd and excoriate the sheeple with cries of BTFD [aka "we really need you to buy at least some of our soon to be big time losers, because The Bernank & Geithner have their hands full with MBS & banking black holes, not to mention the plague of Black Death of looming EuroDebtapocalypse, and we are going to need to be as liquid as possible - please?"]
Bad Christmas season coming. Sounds like kids may get gifts, but I think this is season where adults settle for Xs and Os
Please please please let CMG be next.
PPT is doing a great job....we should have been down 2,000 Dow points on all these breakdowns.... WELL PLAYED Sir!
Please, please, please let BAC be next. And I'm not even short. It is simply time to flush that one.
i've noticed CMG has not been as crowded as of late. don't get me wrong. they are still slinging some serious burritos but volume has to be down.
Santa doesn't come to America since the stupid vermin elected the muslim.
No worries, the CNBS and sell side momos still have PCLN to ramp. If that fails, they can always cut to Phil "Go Unions" Lebeau to distract the lemmings with a pretty new Detriot built and middle class financed glossy red future recall p.o.s.
If that doesn't work then the next step is CNBS "directive #1"...unbutton the blouses and focus on rack.
Speaking of momos, I hope robo got out of netfix & amazon somewhere near the top, otherwise it has been a pretty rough ride lately...
You got it wrong. The true strength in Amazon is actually its brand name. All the tech stuff you mentioned is nothing, someone good at it can do that in a few months of time.
Amazon is now just another middleman, baby.
Nuh-uh. They're women, and they're on the moon....
Amazon wouldn't even have the .07% margin without the tax free advantage over retailers that have to pay for Amazons free ride .
Amazon wouldn't even have the .07% margin without the tax free advantage over retailers that have to pay for Amazons free ride .
#2 of the 5 horsemen of the stock market apocalypse. NFLX, AMZN, BIDU, PCLN and AAPL. The market's end is near.
another one bites the dust... @theback9 nailed it again http://hedge.ly/slrwMs
But, but, but, the CNBS momoconimists said that AMZN, FSLR, and NFLX would guarantee full employment by Q4 2011!?!?!?!
But, Bob Pissonme said this is just a bit of a rain shower in an otherwise bull market. Really, this is just the expected pull back after a great run up in the market, the economy is in good shape.
Can't you feel that wet spot running down your back, it is just rain!
Bezos giving Pissonme a golden shower
Cramer- buy buy buy buy................... Oh wait that was Netflix
Gotta love that operating margin at Amazon
Next year will be event better when CA buyers have to pay sale taxes.
I am Robofader and I went short @ the highs. I am the best
LOL
The only thing Robo is short is his ability to pick winners before the fact.
BTW Where is that POS MomoTard? Yesterday it was Netflix and today Amazon; two of his favorite bulltard calls. What a lousy POS conformist establishment pig is he! ZH readers kept pointing out the fundamentals of these companies and he scoffed. Well, Robo, what do you have to say now? Be a man! Let's hear your rationalization...
10 Billion, 20 Billion, it means nothing if you earn .14 cents. Freaking absurd.
It's easy if you give a $450 million spread on the next quarter....
Don't worry, they will pump this junk back up tomorrow. This is the darling stock for many idiots.
and BOOM goes the dynamite!
Bring on LNKD and CRM.
looking forward to (buying puts on) GRPN
Yep. Got some big puts on LNKD and CRM, two supreme shitbags with p/e at 400+.
I'd add VMware to your list. Not a complete shitbag, but you definitely do not want that P/E ratio in this environment...
LNKD currently at P/E of 1,238...
You know that it would be untrue
You know that I would be a liar
If I was to say to you
Girl, we couldn't get much higher
Come on baby light my Fire*
*Kindle variant
I'll stick my neck out and say that Kindle Fire will grab significant iPad market share, and the ramp up of volumes will be okay. Rebound in the cards.
catacl1sm, I'd be remiss to not give credit where credit is due (context nothwithstanding):
Boom Goes the DynamiteAmazon's going to follow NFLX. They'll likely soon respond with raising pricing for Amazon Prime which will lead to even more losses.
With a P/E of 100, they have a lot of room to fall.
Exactly, they are still at NFLX from three months ago levels in terms of PE. No reason to buy here.
I'm still waiting for the web2.0 bubble to pop.. Linkedin has a P/E over 1000! Christ. Then all those angel/VC seeded companies with poor business models, will go bust. DST (Digital Sky Technologies) will implode, and Silicon Valley will be ruined, from their bubble-mania (look @ the lofty valuations in secondary markets). That is the lesson for misallocating capital in such a grand scale. There is no free lunch. Bankers have failed to learn this lesson.
#occupywallstreet.
PCLN I'm looking at you
floats of PCLN, and LNKD are too small. I wouldn't short them, less a short squeeze wipes you out. But the drop in AMZ, and NFLX will put over-valued web companies on notice.
Shorting the likes of PCLN or LNKD is always a tricky proposition. Just ask Whitney. Worthless OTM puts are better than a margin call. With a P/E of 35, market cap of nearly $25 billion, and a book value of $2 billion, the flameout will be spectacular. Just like NFLX. Unless of course they continue to grow their revenue at a rate of 25-35% each year.
Check out Jan 2012 OTM PUTS. They go clear down to $90.
They didn't "fail" to learn it. They were protected from learning it by the insertion of hundreds of billions of dollars to cover the losses that such behavior brings. So they've learned the lesson they were taught: we do not need to fear losses as long as those losses are large enough; when large enough, the taxpayer will take the loss. Moral hazard, not incompetence.
Wow, AMZN tanks, ES doesn't even care.
What is ES? Thanx in advance.
Electric Seal.
He don't give a fuck about much, granted.
S&P futures.
Wow! So the retail outlets are all vacant, and not even the low cost internet behmouth could pull off a victory. This begs the question: where are consumers spending all their money? Just today, the consumer confidence and consomer spending chart on ZH diverged hugely where ZH asks the question, and I'm paraphrasing, "are these numbers made up too?"
Looks like we have our answer.
Amazon is fuxored.
Everyone is buying at taobao.
Well, aren't we all buying ipads to watch Netflix.. no?? We all have 2 GM vehicles in the garage, right?
Well, I just cancelled my cable sub, and as luck has it, I do have two NEW GM vehicles in my driveway, love them both (2010 Camaro SS and 2011 Cruze). Bought the first with profits from shorting GM awhle back. And who knows, I might get NetFlix at some point, but for now, I find myself a lot more relaxed with no TV at all, other than the humerous links to youtube often posted here. And even weirder, I just bought a vidcam at Amazon today (it was marked about half off compared to other sources).
But these are NOT norms for me. The last new car I bought before these was in '77, and the last time I bought anything from Amazon was last year, and it was a cheap used book.
I'm pretty weird for my neighborhood, I'm almost an ant-indicator, so No One might just be on track.
I don't pay lot fees 'cause I live in my car
I buy PM's and Whisky as an investment with all my spare cash, screw Amazon. I'm confident....
those margins are soooo thin...not much room for error. A tech error like RIMM had would kill their year. I think Safeway has better margins.............
CMG to 250 next up...
Have people given up eating too?
picked up some Amazon oct 205 and 215 puts; wish me luck
IM FKING RICH!11111
Please keep your finger on [Shift] while pressing the 1's
I would like to buy a vowel please.
Okay, I don't follow this stock. I just have to say how the fuck someone pays $250/share for 100 P/E. The stock was 37 in 2008 and 26 in 2006. Some people out there are fucking brain dead.
Buying stocks to some is the equivalent of pressing the "like" button on facebook.
All through the power of one-click shopping.
Can you say 'Oweblahma voters'?
Because nobody cares about something called dividends anymore ... all chasing paper price appreciation.
Because some moron was talking about 'reinvestment risk'
This will be the day MOMO dies........RIP
You promise? Methinks momos hold this market together...
Ah... PPT....QE and all the printing......bechea the printers are being warmed now...
Fuck you Fed!
What the hell, I thought bad news was bullish? Just when you think you've got the market figured out it throws another whammy at you. Don't the investors remember QE3 is going to come sometime in the future so they should just start pricing it in today?
1973-1974
cnbc should be shut down because of the drivel they produce. And yesterday MarketWatch headline,,,, "FDX to hire 20,000 seasonal workers"... What it should have said that they will also fire the same 20,000 and probably a few more in January. Bullshit makes me sick. We get closer to Moscow every month.
"No, Paulson & Co. is not long."
That's funny....
What's with the incessent Paulson bashing? It's like if you guys end up getting rich on pms and Paulson bashes you. What'd you want him to do with 20 billion dollars? In addition to the financials etc., he went out and bought gld with it, which, unless you're actually short pms in an attempt to perpetrate a perfect Goldman-esque fleecing, ought to make him your biggest hero, no?
We all have a little schadenfreude.
What's schadenfrude in German again?
The guy was lionized for making money off the 2008 crisis when it was gift-wrapped to him via GS scamming their clients, and then proved he doesn't get the real bear case by going megalong TBTF zombies post crisis. I'm happy to see him lose even if it hurts PMs in the short run.
Meh. Paulson went to Goldman and said, CDOs are shit and these are the worst tranches of shit I can find. Goldman said "housing is never going to slow down." Paulson said well then, let me bet against this shit. Goldman said okay, but in case you're right, let us find you some other sucker to carry the other side of the trade. Paulson said, fine by me.
Moral of story in my mind, Goldman = scumbuckets, Paulson, pretty fucking smart if a little opportunistic. You guys are all planning on screwing your neighbors by having the only bars of gold and silver in town when it takes $2000 to buy a loaf of bread. I don't buy the sanctimonious moral angle on the Paulson bashing. Just looks like envy.
As to not getting the bear case--not quite right. He fucked up the timing not the thesis. When setting up the gold trade, he told clients I'm doing this because I think QE is going to work for a while, and then shit is going to hit the fan somewhere around 2014. You're butying into the mainstream characterization of him as one of the evil elite. Don't think that's really who he is. He's more like a ZHer who knocked the cover off the ball. Just sayin.
Yep, John is sure knockin it outta the park, lol
"What's with the incessent Paulson bashing?" Probably because 1) he's looking like a one-trick pony and 2) he got into a deal that probably 99.9% of the population couldn't get in on with the housing short.
My big problem is his housing short wasn't even his idea. But then people look at him like he is a genius.
Hahaha--because he (and Paolo) got of the couch and had the ambition, balls, and motivation to go to a.) college, where Paulson graduated top of his class and b.) into business for himself putting his own money on the line. Whatsmore, Pauslon had nothing to do with the invention of CDS on CDOs, trading desks at freaking MERRILL and LEHMAN etc were the first to put them together and he bought up as much as he could, losing on them relentlessly until the tide began to turn. THEN came the Goldman trades. Stop eating the propaganda.
Wow- you gonna give that book report in your 3rd period Social Studies class tomorrow?
Your whining seems a bit bizarre, dude- settle down, it's just money, and no, Paulson won't read your posts and offer you a job when you graduate.....
His selling of gold to make margin calls on his less wise investments is probably why we were able to buy it so cheap recently. It had to be at least part of it, along with the margin hike. So we don't hate him. We just think he's been more or less an overhyped one trick pony.
Morgan Stanley is long...they've had some fuckin' stinkers lately
They sure have bob. First Solar gave them a nice preview of their own fate...
As I said People are not spending. As Main Street is floundering and Wall Street is Celebrating, Main Street is slowly taking down Wall Street.
Wall Street has not cared about Main Streets problems. Just maybe now they will take notice.
Call it trickle up Depression.
Not spending and paying off Debt instead of "Saving" Money is my way of a Passive Agressive Protest against Wall Street and their Greed.
I deprive them of the interest on my Debt and do not put Money in their Banks. All of the Money goes to pay down Debt and Mortgages.
The Banks and Wall Street loses on both accounts. They lose the interest on any Debt I "had" and the Money that would have gone into their Bank in "Savings".
Plus, not spending takes down the Companies on their Golden Wall Street. As the Companies cannot make any Money if I and many others do not buy their products.
You ain't hurting them - you helped them by going into debt in the first place and you're still paying it back with interest - I call that a good little bank customer. I've not had ANY debt since '72 myself -- they get squat from me.
Maybe so but remember I am making Money on thier Money as well. With Rental Property's borrowing Money to Buy them and then collecting Rent, after about 5 years of Ownership I start to make Money on the Banks Money and over time the Tenants effectivly pay off the Loan and the Interest. Plus, I usually get 5% return above the Mortgage Payment.
I also said in a previous post it takes Money to Make Money.
How much of this does JAT Capital own?
Oh well, at least they didn't cut their dividend...oh, wait...
To what ungodly number will this send the trailing P/E to on AMZN?
if they post a loss in Q4.. their trailing P/E might be near 1000 or something ridiculous even after an 18% sell off.
Trailing P/E after this number and accounting for the 15% after hours decline is still 100x. That's progress.
Again, i must point out the fact that i think GROUPON's IPO just died as well.
I hope not, I have been dying to short that one. That business concept is worth exactly zero.
not groupon the i.po_ny?
santa? say it ain't so!
It's disappointed 5, 6 who knows how many consecutive quarters and recovered all its post-earnings losses within a day or two if not sooner and headed off to the momo races. Could this time finally be different? Anyone's guess since questions of fundamentals have long since been left behind.
It's OK guys, I just got a PM from Robotrader. He assures me that he's been long for 5 years and got out at exactly the top, just before this news.
Over 200 hundy/share and shareholders are presented 14 cents each...wow.
BRCM getting blowtorched.
Waiting on others.....
buy TYP afterHour.
RT, how many shares long were you AMZN?
down all of 4%, yeah that's blowtorched.
zion and genworth were more fun to watch imo.
Anyone else notice a lot of high profile misses today - 3M especially.
And FDX claims to need 20k more bodies in 4Q.
That will end well.
Corporate layoff notices are being sent out via overnight FedEx.
It's the newest trend.
As the 'Bobs' from Office Space would say:
Another one bytes teh dust.
AAPL, IBM, AMZN, BRCM all dissapoint massively and the NDX sits 100 points off the high of the year. The possibility of money printing is a powerful drug
But CNBC told me we're seeing killer earnings across the board?
his mom let him out of the basement
Zyngas IPO will save us all.
{sarc off}
In the words of the latest Oil martyr, they will march on them 'zynga, zynga'
all i got to say is
Well, there goes my Amazon prediction of them being the only ones to survive a crappy XMAS retail season!
Zynga IPO is def worth a look. To investors: I'd keep an eye on any potential online poker legislation and watch Rep. Barton's hearing today on the matter on CSPAN. Zynga poker client considered one of the best in the business for both PC AND Cell Phones. I am sure casinos will line up (if not themselves) to use this poker client as well as the cache of untapped potential player pool that is Facebook.
NO worries they'll make it up on volume
All day yesterday CNBC was saying that the Hedge Fund Managers would have to hold their Breath and buy as most were not making enough profit.
Looks like today they Breathless at their losses.
HFT Algo bashing resumes/continues tomorrow.
Lands End is floating a 40 off 100 coupon with free shipping good until Thursday.
Maybe their having a slow quarter?
I wanna see pinata bread implode. And that ridiculous burrito joint.
I buy from Amazon all the time. They have the lowest prices, cheap or free shipping, generous return policies, etc. etc. I am not surprised to hear their margins are this slim, or shipping costs unrecovered. I feel partially to blame for this one.
Sorry, Jeff.
Agreed Ned; I like the Co. but not the stock.
AMZN is probably a good 50-80$ stock, certainly not a 200$ stock.
I agree, I'd say $50-60 for someone into buying stocks in this environment. It's basically Walmart with a riskier growth story.
They charging Ny sales tax drove me away. Bye Bye AMAZN, just another retail outfit.
Too many AAPL me-too products. AMZN should stick with online retailing, and not netbook design, cloud computing, marketing algos, et. al. Is this lackof focus Bezos' mid-age crisis? Caveat: short AMZN, since $230.
I know I never put this in print here on ZH so I'll sound like a pouser, but I've been telling friends/family that Apple, Amazon, and Netflix were overpriced.
Apple: rehashed versions of the same product, dated specs (especially in macbook pros), + no "new" iphone. and all this at a premium?
Amazon: people can't afford anything except food.
Netflix: price gouging.
I think VmWare is in trouble. P/E is too high; only way it grows into that is by cutting bottom line and accounting tricks, not via margins.
Also, with all these bad earnings reports, expect to see the tax holiday by the holidy season. It'll be QE3 without the Fed scrutiny. A green Christmas with a giant serving of moral hazard in the ol' corporate stocking.
Pre-announcement trailing P/E of well over 100. And they are going to post an operating loss.
Price discovery, bitchezzz.
Robo momo stocks falling like that old international space station...lolz.
Saying that was a "prediction" is a bit of a stretch don't ya think?
AMZN .. the on-line book store that sells other retailers shit.
HEY AMZN 2005 bubble called and said they want there stock back.
punch your self in the nuts , it will feel better
So . . increasing volume (JUST PRIOR TO A TWENTY-FIVE PERCENT DROP) is purely random?
Or is that's what's known as insider trading?
guys
this is totally bullish. people are too busy working, buying stocks and houses therefore don't have time to shop on amazon.com!!!!!!
Poor amazon. And just when running massive cloud services on completely VM tainted kernels was looking like such good idea.
Unlike structural issues at Netflix, Amazon's EPS hit is mainly due to discretionary opex the company is doing. Here is what some of the sell side analysts are saying on the no.s:
http://equityleaks.blogspot.com/2011/10/amazon-inc-margin-shrinks-as-inv...
AMZN's secret?Pretty simple really, they lose $10 a unit on the Kindle Fire but they make it up on the volume.
Yet another darling momo stock is whacked and the NDX is just under the years highs,the Euro nightmare is shortly to be resolved or not,either way, does anyone here apart form Tyler think tptb will let the Euro or the markets drop if the European govts don't fudge the Greek/ESF?
Whatever the outcome,the Euro and stockmarkets will be pushed higher IMHO,just to prove that the system isn't broken.