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Amazon isn't making any money yet. Maybe in future they will make some. I don't like using AWS (I just don't know why), I prefer Microsoft Azure and Digital Oce

by kahwooi 10y ago

Amazon isn't making any money yet. Maybe in future they will make some. I don't like using AWS (I just don't know why), I prefer Microsoft Azure and Digital Ocean.

msandford 10y ago
> Amazon isn't making any money yet. Amazon makes TONS of money. They aren't currently returning any of it to shareholders as profits, they're continuously reinvesting it in the company. The difference between gross profit and net profit is how much Amazon is spending on building new businesses that after a few years start grossing $10b a year in sales like AWS. That got funded out of the gross profits from regular Amazon retail operations.
- kahwooi 10y ago
  LOL. Ballmer say so: http://www.geekwire.com/2014/ex-microsoft-ceo-steve-ballmer-says-amazon-com-isnt-real-business/ http://www.geekwire.com/2014/ex-microsoft-ceo-steve-ballmer-...
  - rhizome 10y ago
    Ballmer isn't conflicted or anything.
    - beambot 10y ago
      Not to mention that MSFT went from $50/share to $30/share under Ballmer's tenure as CEO. Not sure he has any legs to stand on to bash AMZN about being a "real business." http://money.cnn.com/infographic/technology/gates-ballmer-microsoft-stock/ http://money.cnn.com/infographic/technology/gates-ballmer-mi...
  - CamperBob2 10y ago
    Also, the iPhone is never going to fly.
- ProAm 10y ago
  How long should an investor wait to get any ROI on a 20 year old company? (honest question)
  - deleted 10y ago
    [deleted]
  - jfoutz 10y ago
    If you want defined returns you can buy amazon bonds today. if you want to try to triple your money in 5 years, well, maybe that'll happen with the stock again. who knows?
  - TheSpiceIsLife 10y ago
    1st July 2006 Amazon shares traded for $26, they're currently bouncing around $600. See here: http://finance.yahoo.com/echarts?s=AMZN+Interactive#{"range":"10y","allowChartStacking":true} http://finance.yahoo.com/echarts?s=AMZN+Interactive#{"range"...
- taneq 10y ago
  This seems like a huge distinction that people don't make often enough with high-performing, fast-growing companies. You see it with Tesla, too, when people claim that the Model S is "sold at a loss", ignoring the fact that a large part of the company's current expenditure is in setting up huge new factories.
  - lubos 10y ago
    Bad example. New factory is an asset, not an expense. Therefore it will have little impact on profitability.
    - deleted 10y ago
      [deleted]
    - simonh 10y ago
      The AWS data centres aren't an asset? I'd have thought comparing funding expanding Amazon's data centre capacity from revenue is very comparable to Tesla building out it's manufacturing capability the same way.
      - discodave 10y ago
        The DCs are assets with 5-20 year lifespans but the servers depreciate over 3-5 years. Amazon has also been doing a bunch of capital lease shenanigans so they could expand AWS without having to report GAAP losses over the last few years.
        fabulist 10y ago
        Genuinely curious, who sells, rebuilds, or otherwise "end of lifes" a datacenter after 5 years?
- bdkoepke 10y ago
  The issue is Amazon stock is very expensive when compared with other companies. Walmart's market cap is ~250B, whereas Amazon is $350B. Amazon had $100B sales last year, Walmart had $500B. If Amazon can generate profit at the same rate as Walmart then Amazon needs to get to $700B in sales for that valuation to make sense... If Amazon double's in value again it would have to have sales representing 10% of US GDP at the same profitability level as Walmart. Smells like a speculative bubble to me.
  - petra 10y ago
    Amazon is a much more global/scalable company than Walmart, both now and potentially, so the calculation should be a bit different.
ryptophan 10y ago
Haven't tried Azure yet - will give it a spin eventually. I love Digital Ocean compared to AWS. Sure, AWS has a lot of bells and whistles, but this simplicity of DO is just what I need most times.
- themartorana 10y ago
  AWS has moved on from single-EC2-instance simplicity. It's not worth it if you don't need a virtual rack of servers with all the VPC networking that comes with it. But if you _do_ need that, like we do, it's bloody brilliant.
adventured 10y ago
$596 million in net income the last four quarters to be exact. So yeah, they are making money. Further, AWS is a money printing machine. It's generating over $700 million in operating income per quarter, and that's growing very fast. It'll be at $5+ billion per year in operating income within perhaps just two or three more years. There aren't very many technology businesses anywhere producing that kind of operating income.

by kahwooi 10y ago

Amazon isn't making any money yet. Maybe in future they will make some. I don't like using AWS (I just don't know why), I prefer Microsoft Azure and Digital Ocean.

msandford 10y ago

> Amazon isn't making any money yet. Amazon makes TONS of money. They aren't currently returning any of it to shareholders as profits, they're continuously reinvesting it in the company. The difference between gross profit and net profit is how much Amazon is spending on building new businesses that after a few years start grossing $10b a year in sales like AWS. That got funded out of the gross profits from regular Amazon retail operations.

kahwooi 10y ago
LOL. Ballmer say so: http://www.geekwire.com/2014/ex-microsoft-ceo-steve-ballmer-says-amazon-com-isnt-real-business/ http://www.geekwire.com/2014/ex-microsoft-ceo-steve-ballmer-...
- rhizome 10y ago
  Ballmer isn't conflicted or anything.
  - beambot 10y ago
    Not to mention that MSFT went from $50/share to $30/share under Ballmer's tenure as CEO. Not sure he has any legs to stand on to bash AMZN about being a "real business." http://money.cnn.com/infographic/technology/gates-ballmer-microsoft-stock/ http://money.cnn.com/infographic/technology/gates-ballmer-mi...
- CamperBob2 10y ago
  Also, the iPhone is never going to fly.
ProAm 10y ago
How long should an investor wait to get any ROI on a 20 year old company? (honest question)
- deleted 10y ago
  [deleted]
- jfoutz 10y ago
  If you want defined returns you can buy amazon bonds today. if you want to try to triple your money in 5 years, well, maybe that'll happen with the stock again. who knows?
- TheSpiceIsLife 10y ago
  1st July 2006 Amazon shares traded for $26, they're currently bouncing around $600. See here: http://finance.yahoo.com/echarts?s=AMZN+Interactive#{"range":"10y","allowChartStacking":true} http://finance.yahoo.com/echarts?s=AMZN+Interactive#{"range"...
taneq 10y ago
This seems like a huge distinction that people don't make often enough with high-performing, fast-growing companies. You see it with Tesla, too, when people claim that the Model S is "sold at a loss", ignoring the fact that a large part of the company's current expenditure is in setting up huge new factories.
- lubos 10y ago
  Bad example. New factory is an asset, not an expense. Therefore it will have little impact on profitability.
  - deleted 10y ago
    [deleted]
  - simonh 10y ago
    The AWS data centres aren't an asset? I'd have thought comparing funding expanding Amazon's data centre capacity from revenue is very comparable to Tesla building out it's manufacturing capability the same way.
    - discodave 10y ago
      The DCs are assets with 5-20 year lifespans but the servers depreciate over 3-5 years. Amazon has also been doing a bunch of capital lease shenanigans so they could expand AWS without having to report GAAP losses over the last few years.
      - fabulist 10y ago
        Genuinely curious, who sells, rebuilds, or otherwise "end of lifes" a datacenter after 5 years?
bdkoepke 10y ago
The issue is Amazon stock is very expensive when compared with other companies. Walmart's market cap is ~250B, whereas Amazon is $350B. Amazon had $100B sales last year, Walmart had $500B. If Amazon can generate profit at the same rate as Walmart then Amazon needs to get to $700B in sales for that valuation to make sense... If Amazon double's in value again it would have to have sales representing 10% of US GDP at the same profitability level as Walmart. Smells like a speculative bubble to me.
- petra 10y ago
  Amazon is a much more global/scalable company than Walmart, both now and potentially, so the calculation should be a bit different.

ryptophan 10y ago

Haven't tried Azure yet - will give it a spin eventually. I love Digital Ocean compared to AWS. Sure, AWS has a lot of bells and whistles, but this simplicity of DO is just what I need most times.

themartorana 10y ago
AWS has moved on from single-EC2-instance simplicity. It's not worth it if you don't need a virtual rack of servers with all the VPC networking that comes with it. But if you _do_ need that, like we do, it's bloody brilliant.

adventured 10y ago

$596 million in net income the last four quarters to be exact. So yeah, they are making money. Further, AWS is a money printing machine. It's generating over $700 million in operating income per quarter, and that's growing very fast. It'll be at $5+ billion per year in operating income within perhaps just two or three more years. There aren't very many technology businesses anywhere producing that kind of operating income.