Amazon.com Announces First Quarter Results
ir.aboutamazon.com
ir.aboutamazon.com
This seems huge. Spending all $4 billion of their expected Q2 profit on covid-19-related things, including developing their own tests.
Committing to spending all of your future profit (which seems like a huge statement on its own) aside, anyone know how this compares to what other companies (or even governments) are spending on safety/testing? Trying to get a sense for the scale here.
I don’t know if any company putting 1/10 of that kind of money into an effort like that. (I’m excluding drug companies for obvious reasons.)
As for governments, given the difference in measurements, it’s hard to compare. For instance, do you count lost tax revenue? I’d bet several states surpass that, and probably a few big cities come close (NYC & LA come to mind).
I think they absolutely had to say something to placate the rising tide of voices against their monopoly and for their contribution to so many retailers' downfall- even without COVID. This will earn them some brownie points as in "Oh- AMZN's sales went up but at least they were not gouging- they invested all their profit in improving their service and employee benefits"
I’ll give Amazon props when they start supporting warehouse unionization, lobby the govt for a carbon tax, sell off Whole Foods, AWS, amazon basics + all in-house home goods into separate entities. Of course that will never happen because anything that actually stops the harm that Amazon does would be detrimental to the business.
So which is the noble big company you support? Which has sold of all diversified businesses? A company doing what you are suggesting will not even survive for long.
Amazon, Google, Apple, Exxon, etc. are all built on exploitation.
My point wasn’t that Amazon is more evil than other corporations, I think that’s only marginally true. Probably only because of how much more efficient they are than a lot of companies.
All of these systems suck, so let’s favor people who can lead voluntary large tribes over the politically connected, such as the politburo.
So, yes, when things like this leak out [0][1], you'd bet your bottom dollar that Amazon does really care about optics [2].
That said, I understand their predicament and I admire tough decisions they need to take to keep the business going [3] in a time where logistics is an absolute nightmare even at a smaller scale, but I don't, for one second, underestimate their will to bend rules and regulations to hit whatever bottom line metric they are measuring at any given point in time [4].
[0] https://news.ycombinator.com/item?id=22763057
[1] https://news.ycombinator.com/item?id=22738592
[2] https://news.ycombinator.com/item?id=21818233
i.e. Sell an equivalent item at a loss for an extended period of time to force a competitor / retailer out of business? Opening up a physical bookstore after essentially crushing that market felt like a "finger" to ex-businesses to me.
I think a lot of people are mad at Amazon for various things; undercutting mom-and-pop businesses in niche markets, paying people to deliver packages almost for free, busting warehouse unions, counterfeit items, etc. The solution is to not fund Amazon. Move your servers elsewhere. Shop at Target. Ask your representatives to make stronger labor laws.
But all in all, I don't think it's intrinsically wrong to start selling an internal tool and then end up making a lot of money from it. If Amazon weren't dominating online retail, someone else would be. Nobody wants to go to a store. It's boring and there isn't a very good selection. That is not the fault of cloud computing.
If they actually were selling products at a loss to put competitors out of business, that would be considered predatory pricing. Imagine Apple using their iPhone profits to sell MacBooks for $200 - it would distort the market and eliminate competition. It might be good for consumers in the short run, but much worse when they were the only game left in town.
https://slate.com/technology/2013/10/amazon-book-how-jeff-be...
Lawmakers don't do things when one person asks, they need significant public pressure. Publicly showing displeasure with how a company operates is usually the first step for that.
It seems to me that EPS is just earnings divided by an arbitrary number. Why not look at operating profit as a percentage instead?
(Earning / Price) is not a typical metric, (Price / Earnings) (i.e. PE Ratio) is the more typical metric. These metrics are meant for casual/institutional investors not lay people[1].
Meanwhile, if you still want (Earning / Price), you can do (1 / PE Ratio).
[1] If you aren't able to find the number of STOCK units you own or will purchase, then you are not a casual/institutional investor.
The number of shares you own is not arbitrary - it's actually a very important number to you. So you multiply how many shares you own, with EPS, and you know your personal profit.
In particular your profit per how much that share cost.
Obviously investing in stocks has other ways that you can make money, but EPS is pretty core to the whole thing.
If you want an overalls figure look at their financial statements.
Yes, if you're curious how well a particular company is doing over time, then it's arbitrary and not very helpful. But if you are comparing the relative value of a single share of company A vs company B, then it's helpful.
(Which is then also related to the sibling comment about dividends).
Probably the EPS metric made more sense before Excel.
Of course that's only a superficial analysis. You have to take into account the book value (asset value). If the company is high growth. What industry it's in. Whether a change in earning per share is due to a one-time event. Etc.
It's safe to say Jeff is the wealthiest person that has ever lived, short of fantastical examples like Genghis Khan. Gates hit near $100b ($152b inflation adjusted) during the peak of the dotcom bubble. However, logically only some split of that $100b should be exclusively credited to him, as he was of course married to Melinda, whereas Jeff is worth $150b alone. By contrast, Rockefeller was likely never worth more than $25 to $50 billion (inflation adjusted; at his peak it's thought he might have approached $2b in his day; the historical record is certain he crossed $1b; the reasonable inflation adjustment back to the 1920s and 1930s is anywhere from 20x to 30x depending on how aggressive you want to be).
(ignore the stupid, yet persistent claims that Rockefeller would be worth $300-$400 billion today as an adjustment; those claims are not using any manner of proper inflation adjustment; instead, that's based on taking Rockefeller's wealth as a percentage of the US economy at the time, and then doing the same thing for the US economy today (eg if his wealth equaled 1.5% of GDP in 1928 or 1937, then 1.5% today would be $330b), a complete non-sense approach for numerous obvious reasons)