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Brawmethius t1_iuhtp8k wrote

Maybe this will shed light to all the headline ER "traders".

"wHy StONk doWN, bEaT EPs"

Yeah well buddy no one was happy to see AWS slowing growth and this graphic does a great job of why people are not happy about that.

Plus bad Q4 guidance.

Investors probably starting to go "Hey amazon can you go from that we losing money to grow to just profit on the main business" and Amazon said yeah no lol.

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discountgenghiskhan t1_iuif01a wrote

Amazon’s policy about growth haven’t changed in the last 20 years, I don’t think they give a flying fuck about their stock prices or what the retail traders think.

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Notoriolus10 t1_iujbn8m wrote

They are a net issuer of shares and they rely on stock based compensation a lot to retain talent, to the tune of $17.7B in the last 12 months. Even if the company didn’t care about their stock price, their employees sure do.

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Humble_Increase7503 t1_iuk108y wrote

There’s Amazon “don’t care about the stock price”

And then there’s meta “don’t care about the stock price”

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[deleted] t1_iui7lqj wrote

What specifically do you see in this infographic that's bad? Other than a visual illustration of how small the profit margin is compared to the cost & revenue?

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LeCheval t1_iuic58i wrote

Look at the profit margin for AWS compared to the entire rest of Amazon’s business.

AWS

  • Revenue = $20.8B
  • Operating Profit = $5.4B

Rest of Amazon

  • Revenue = $106.3B
  • Operating Profit (Loss) = ($2.98B)

If Amazon were to immediately sell off everything except for its AWS portion of the company, it would (theoretically) increase profits by ~$3B. Everything other than AWS looks like a money sink.

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spagetidoodle t1_iuj38oh wrote

If you controll the full market at a loss you are worth more than if you controll small amout of the market at a small profit. Amazon have money to play monopoly

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ankole_watusi t1_iuj641f wrote

If you control the full market at a loss eventually governments will crack down to prevent becoming a monopoly. And the unfair practice of “buying market share”

And this would be very damaging.

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boygito t1_iujaw92 wrote

No they won’t. Governments only crackdown if a monopoly is hurting the public to make obscene profits. If a company is losing money, hrs hard to argue they are hurting the public

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ankole_watusi t1_iujdp5l wrote

It’s predatory and yes they do. Bait and switch.

They don’t generally do it till the prices go up after complete control though.

Gummit is slow.

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hellish0098 t1_iuivi9m wrote

Well…we need a more detailed breakdown to identify which businesses are actually losing money, I wanna bet those physical stores and prime content are huge money drainers

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ankole_watusi t1_iuj5q4a wrote

Haha plus they would have a huge captive customer for AWS.

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Brawmethius t1_iuibhc2 wrote

Yes exactly that. With out AWS they run at a loss.

What did we find out at Q3?

AWS slowing growth.

Or in other words; Amazon effectively came out and said there is a chance we return to operating at a quaterly loss.

Expecting additional costs to revenue and slowing revenue.

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[deleted] t1_iuil8do wrote

[removed]

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Brawmethius t1_iuilvu9 wrote

Apple has about 90B quaterly revenue, Amazon has 130B.

Apple has better margins and lower total overhead. They are better at turning their revenue into profit.

In theory why Amazon got run up to 100 P/E is if they could maintain this revenue stream and bring down their costs they would become more profitable than Apple.

This last Q3 earnings reminded investors that is not in the next year.

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Humble_Increase7503 t1_iuk0uny wrote

On AWS, perhaps they set some really hard to beat comps, and keeps a strong/healthy growth rate years out.

The truth of AWS growth was probably somewhere in between

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Wotg33k t1_iuhzb4w wrote

Bezos ain't got it.

I just don't think he has the love for technology and human life that it takes to take Amazon to the next level. He got caught up in the profits like most do. None of these dudes are nerds or geeks. They're sell outs. Except maybe Elon, but he's disappointing in his own way.

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Archivist_of_Lewds t1_iui3541 wrote

Elons king sellout. Dude doesn't even actual invent things. He buys them and then tries to extract profit by boosting shares with market manipulation.

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Wotg33k t1_iui7bhh wrote

I'm saying at least he still geeks out. The rest of them are all just rich and confused.

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