Follow IW:
Comments
Newest First | Oldest First | Threaded View
Amazon plan? Generate cash to support the capital building.....
Kmarko: "It continues to generate enough cash to support the capital building plan." Yes, it does, but barely. What happens if there's not sufficient growth to suppot the building already under way? The discussion of a hike in Prime subscriptions generates more cash flow, also commits the company to a year of free deliveries at a modest price. I sort of see what they're doing; wary that it's always going to work.
Amazon overly ambitious?
The thing that makes me wary is that Amazon.com is trying to do so many things at once. It's building out fulfillment centers. It wants to do same day deliveris and deliveries of fresh groceries in those big green trucks marked "Fresh." That's a huge amount of distribution infrastructure they're trying to build out. They are trying to be in the consumer hardware space with the Kindle and Kindle Fire tablets. They want to compete with Netflix in movie and video downloads, while hosting Netflix. They want to produce video content. They're trying to capture the consumer in multiple ways. It may work but it may also be overly ambitious.
Call me a socialist ...
But since when is 20% revenue growth with a doubling of net income cause for disappointment among investors? That's a sign just how crazy expectations have gotten. At some point, what if Amazon decided not to raise Prime prices and instead to hold steady and even plow more profits back into R&D, a la Apple? Would the stock be lowered to junk status?
Re: AWS just a blip?
I wonder if the Prime price increase is also a tell for the future of AWS: get a healthy chunk of business customers committed to AWS, and then slowly start raising prices.
Re: AWS just a blip?
In my opinion AWS is not a big cash cow for Amazon but definitely it's not trivial in terms of company's future success. Strategically cloud computing is the future trend and Amazon is investing it. Furthermore, the company is doing a sustainable business and generating enough cash for future growth. I still expect a bright and prosperous future of Amazon, especially in cloud computing area. AWS is a good business and it outperforms many other big IT giants such as IBM and MS.
Re: AWS just a blip?u
No, not superficially, but AWS-like software and infrastructure clearly undergirds Amazon's processes. So, yes, AWS will eventually be a financially significant part of the company.
What do you think? By couching the question this way the clear inference is that you think AWS is trivial to Amazon's business. Is it? If so, will it remain insignificant?
Re: AWS just a blip?
Google and many other firms would also like to have as much consumer information as possible, so it might be hard to get into that space, if Amazon does manage to get massive amounts of consumer information could they still keep their low net profit margins or would they eventually have to raise net profit margins in order to satisfy shareholders?
Re: AWS just a blip?
The health of Amazon's business is in the eye of the beholder, but it contintues to generate enough cash to support the company's capital building plans. Regarding AWS, it's still a blip a ~$4B, but still bigger than IBM, GOOG or MSFT in the IaaS and PaaS market. Clearly, AWS is not material to the company's current operations, but it is strategic to its long-term goals. I think a tell was the offer to provide Kindles as in-store POS devices. The goal seems to be sucking as much consumer information into your infrastructure as possible. Once there, Amazon has demonstrated how to monitize such information.
AWS just a blip?
Great that it looks like Amazon boosted its cloud services revenue, but is it really material to the health of the business? Is it ever likely to be?
2018 State of the Cloud
Cloud adoption is growing, but how are organizations taking advantage of it? Interop ITX and InformationWeek surveyed technology decision-makers to find out, read this report to discover what they had to say!
White Papers
Current Issue
Cybersecurity Strategies for the Digital EraAt its core, digital business relies on strong security practices. In addition, leveraging security intelligence and integrating security with operations and developer teams can help organizations push the boundaries of innovation.
Video
Slideshows
Twitter Feed
Everything You've Been Told About Mobility Is Wrong 
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.
Flash Poll
- Terms of Service
- Privacy Statement
- Legal Entities
- Copyright © 2018 UBM, All rights reserved
Tweet This
User Rank: Strategist
2/3/2014 | 5:26:44 PM