17 ms·

Amazon Reports Surge in Profit

164 points by gist 11y ago

kimcheekumquat 11y ago
update: after hour currently at 675.01. Price increase +73.01 (12.13%)
- coldcode 11y ago
  With a market cap of half of Apple's they made ... 1/20 of the profit. For the first time ever.
  - sangnoir 11y ago
    what are the growth prospects for Apple vs. Amazon? Market cap is influenced by speculators who want to buy low and sell high, and to them - the bigger the growth prospects, the better.
gist 11y ago
AWS currently improves product and cuts prices. My feeling is that as they mature over time and get even more of a lock on the market (and their customers) with the obvious lock in they have that will reverse and prices will increase over time resulting in even more profit than they reported today. Impossible to think this won't happen, especially with the differentiation they have with their product as well as the FUD of changing to a marginally less expensive provider (who will probably follow suit).
- brianwawok 11y ago
  Or another future - as more people see Google and Azure can compete... they build cloud agnostic software that treats providers as a utility, and profit margins fall and fall.
  - mason55 11y ago
    > they build cloud agnostic software that treats providers as a utility It's like browsers all over again. As long as each provider is offering different things or different implementations of the same thing we will either need to choose one or be forced to go through a lowest common denominator translation layer. MSFT, GOOG, and AMZN are all smart enough to not turn this into a race to the bottom of who can provide the cheapest scalable instances. They'll all try to differentiate on features and so it's going to be a long time until you can treat these as a utility.
    - Will_Do 11y ago
      I think you're right in that Amazon Machine Learning and Azure Machine Learning will never be drop-in replacements for eachother. However, I would argue that VPSs are already drop-in replacements and I bet (though I have no proof) that VPSs are the majority of the market. The cloud providers may not have a viable way to provide even the perception of vendor lock-in when it comes to VPSs. Now it could be that prices and profits stay high anyways as the market is an oligopoly. The U.S. has experienced the same thing with mobile operators. This is also far from obvious though because entrance barriers for VPSs don't seem steep.
      - mason55 11y ago
        Sure, a basic VPS could be a drop-in replacement, but think of all the stuff that goes on with managing that. If you want to automate the creation of new servers then you have to script it or use something like CloudFormation or Troposphere. Either way you are immediately off the "drop-in replacement" path unless you build a middleware layer for your scripts. These guys make their money off the companies that need to be able to automate infrastructure and that stuff is becoming more, not less, fragmented.
        falsedan 11y ago
        Terraform works with whatever cloud provider https://www.terraform.io/intro/vs/cloudformation.html https://www.terraform.io/intro/vs/cloudformation.html hint hint
- jeffasinger 11y ago
  One issue with this is the idea of competition from physical hardware. At some price point, if the prices are too high, it will be cheaper to hire extra people, and get a cage in a few datacenters and some physical hardware.
  - bookmarkacc 11y ago
    The problem is people who arent big enough to have a whole data center. Or dont have the upfront capital even if its benefital in the longterm. They will still rely on Amazon.
    - Johnny555 11y ago
      You don't need to own a whole datacenter to own machines located in a datacenter, my company keeps machines in a 4 rack cage in a datacenter. (and plans to empty that cage by the time our contract runs out in September to finish the migration to AWS). Our AWS bill is just a bit higher than what we were paying for the cage rental + internet connectivity alone.
      - nopzor 11y ago
        That doesn't sound possible. Are you saying your raw bill for _just_ colo (ie. space and power) and bandwidth (ie. IP transit) was less than your _entire_ AWS bill? I've never heard of anyone take such an extreme stance.
        Johnny555 11y ago
        The 4 rack cage plus extra power plus redundant network at a Tier I datacenter costs us close to $6K/month (including some block of remote hands hours). Even at our peak we didn't have the racks full, allowed room for expansion. Note that this cost includes only coloc costs, not server or network leases/purchases. We have very bursty traffic and run our baseload of ~ 30 severs (mostly m4.larges, with a few smaller utility servers as well as larger servers for back end services) most of the time, but when we need to scale, we ramp up to about 2 - 4 times that, but usually only for a few hours at a time. We also do some batch processing that takes a few high-memory servers for about a day each week. We monitor costs pretty closely and our monthly AWS spend is still less than the coloc fees, and we are much more scalable now and have multi-datacenter (AZ) redundancy, and by the end of the year, we will have a cold spare in a second region (which will cost us very little since it will be mostly powered off) We no longer need to vastly over-provision servers to handle our peak load and batch processing needs.
- jonhohle 11y ago
  One significant advantage of AWS is that they have a very large, built-in retail customer with relatively demanding requirements. I've always been under the impression that Microsoft doesn't really have a business that would lend itself to consuming its own services[0] and it's unclear to me whether or not Google uses their stuff internally. 0 - as an anecdote, I recall their salesmen coming to sell my employer their caching solution around 2008. I asked the rep I'd Microsoft was using their caching product on any of Microsofts web properties and he replied that they were not.
  - abritishguy 11y ago
    Xbox live runs on azure
    - RubberShoes 11y ago
      So does iCloud ;) (and also runs on AWS) http://9to5mac.com/2016/04/11/apple-icloud-in-house-inspur/ http://9to5mac.com/2016/04/11/apple-icloud-in-house-inspur/
    - GeechieCloud 11y ago
      Certain, newer pieces of some of these services, such as the Azure Active Directory service at the heart of Office 365 and some of the newer, complementary Xbox Live services are hosted on Azure. But the core Bing, Office 365 Commercial and Consumer offerings and Xbox Live services are not hosted on Azure. (same article as above)
      - mrep 11y ago
        It seems like amazon is using an "all in" strategy which seems to be working out pretty well. They first focused on porting the entire amazon retail website onto AWS which I believe they completed in 2011. They also went "all in" with the service oriented architecture for AWS. Both of these have paid off quite handsomely. Granted, that hasn't always paid off (we all know how the fire phone turned out), but the wins have definitely made up for the losses.
  - 11y ago
neom 11y ago
Go cloud go!!
serge2k 11y ago
On one hand I miss my RSUs on the other hand I do not miss working there. well maybe a little. it was fun for a while.
- eva1984 11y ago
  Same...But good to know that it is executing well. Go google cloud go! Bring AWS price down!! We need competition!!
  - prohor 11y ago
    Google indeed seems the strongest competitor now for AWS, but there are far more providers who compete - see a comparison: https://www.cloudorado.com/ https://www.cloudorado.com/ . We just need to choose them to avoid monopoly or at least oligopoly.
    - serge2k 11y ago
      Google stronger than Azure?
      - eva1984 11y ago
        I think momentum wise yes... Google is more a service company than MS, and I believe it is more experienced in cloud technologies.
        gareim 11y ago
        In terms of market share, Microsoft beats Google handily. In terms of year-over-year revenue growth, Microsoft is also beating Google, although Google's growth is better than I had expected. http://www.datamation.com/cloud-computing/microsoft-and-google-lead-in-cloud-growth-aws-rules-overall.html http://www.datamation.com/cloud-computing/microsoft-and-goog...
        bitmapbrother 11y ago
jonhohle 11y ago
May 15th is going to be a nice day for a lot of people ;-)
- deleted 11y ago
  [deleted]
- laxatives 11y ago
  What is the significance of May 15th?
  - mabbo 11y ago
    Employee stock vesting day. If you get stocks granted as a bonus (most of us do), they vest in may and November. I know guys who've never sold any of their stocks. This will be literally $10k or more in their pockets, if they finally decide to sell.
    - eclipxe 11y ago
      Jeff just made $6.1B afterhours...
      - csomar 11y ago
        It's "papers" money. It's not cash until cashed out.
        redblacktree 11y ago
        If he's giving any of his "paper money" away, I'm first in line.
      - hokuriku 11y ago
        The vesting schedule at AMZN is 5% after 12 months, 15% in 24 months, and 20% for every 6 months thereafter. For me (SDE I), that works out to $2200 in year 1 and a projected $7000ish in year 2. MSFT, on the other hand, has their stock vests 25% after 12 months and 25% for every 12 thereafter.
DasIch 11y ago
Is there any reason why Amazon would suddenly "waste" money on profit? Could this be an indication of a change in strategy or is this just a temporary thing?
- r00fus 11y ago
  Bezos will hold a press conference "We are sorry we did not realize we would make as much money as we did - consequently our spending just could not keep up" while AMZN tanks.
  - mabbo 11y ago
    Bezos's goal seems only to be Amazon's growth and efficiency. I'm really starting to believe that being one of the 10 richest people on the planet was just a happy side-effect that only distracts him from his goal.
- laxatives 11y ago
  There should eventually be some time when Amazon does finally cash out, presumably on some timeline as a function of Bezos's mortality. Its unrealistic to be around forever. How many companies last hundreds of years? How many tech companies last decades?
  - serge2k 11y ago
    > How many tech companies last decades? Amazon is at 2 decades and going strong. Any reason to think they won't last a long time?
    - discodave 11y ago
      My prediction is AWS will split after Jeff dies (or is otherwise not involved in the company). Then Amazon retail will split from Amazon logistics, and so on.
  - ycombobreaker 11y ago
    Microsoft is 40 years old. IBM is 100. Some other old companies might not be considered "tech" anymore, but only because their market/product are better defined (e.g. Ford is an auto maker, but the assembly line and the concept of an automobile itself place Ford as the "tech" darling of 110 years ago, IMHO). I think if you don't see old tech companies today, it's because over time their public appearance has quietly lost the "how" (new technology, automation) and only left the "what" (search, ipods, advertising, rockets). But that doesn't mean old tech companies die.
cosmoharrigan 11y ago
It's interesting to note that Amazon third-party seller unit share is at 48% of total units shipped, which is a record high. It has grown by 1% per quarter for the last 4 quarters in a row.
- abhi3 11y ago
  Does this share included international sales? If so it could have something to do with Amazon growing in India where it has to route all sales through a third party. http://www.livemint.com/Companies/RjEDJkA3QyBSTsMDdaXbCN/Amazons-JV-Cloudtail-is-its-biggest-seller-in-India.html http://www.livemint.com/Companies/RjEDJkA3QyBSTsMDdaXbCN/Ama...
- draw_down 11y ago
  I don't really like how they sell things from third parties on there. If it's sold by someone else and fulfilled by Amazon that's ok, but otherwise the whole point of buying on Amazon is to not have to deal with weirdo possibly-shady little retailers.
  - hga 11y ago
    Amazon is selling trust there; in my experience, if the seller has a 96% or better rating you'll seldom be disappointed when it arrives, and they'll work hard to give you satisfaction if you aren't. Much better than eBay in my family's experience.
  - tracker1 11y ago
    If you have Prime, and click on that as a filter, that gives you fulfilled by amazon results... A lot of times I'll go another step and choose Amazon.com as the seller.
  - cosmoharrigan 11y ago
    Amazon is pushing very hard to increase Fulfillment by Amazon coverage across the catalog, and is also releasing new products such as Seller-Fulfilled Prime. The customer experience is tightly controlled in both cases.
redorb 11y ago
honestly - stuffing video in with prime then raising the price. recently offering video stand alone but for $9 more a year than prime (with video)... Hard to tell who is actually shipping an item - sketchy pricing based on region / or account etc.. why trust them with aws? it seems their strategy is to price things stupid low - get you on board then raise it when they think they 'got you by the balls' no thanks
- andrewstuart2 11y ago
  Jump on board, but don't wear the shackles! Use something like Kubernetes and FOSS projects and you can shift to whomever has the cheapest VMs today. Easier said than done, I know, but a fine goal to have, I'd say. :-)
  - xyzzy123 11y ago
    I totally agree with you in the ideal case. Problem is in some ways, AWS is too awesome due to all the add-on services. Systems are more than just compute, and the last 3 companies I've worked for have become increasingly coupled to AWS over time due to use of the add-on services. You build your system and over time you need message queuing, ability to send emails, databases, load balancing... You can run / build these yourself but do you want to use up your team's bandwidth setting up say, postgresql replication ... or just use RDS? If you use third-party (e.g. out of AWS) services, you lose the ability to do security with say, instance roles and in larger orgs you lose time to the "new vendor due diligence" process and getting the business to sign off on new support contracts etc. Maybe you also need some new automation tooling. Because all that business-ey stuff is already in place with AWS and administering say, event queues, is sure not core business, most project teams will SaaS that capability if they can. Whatever service is already in AWS ends up being the no-brainer answer. So hard to avoid architectural coupling. Then you look at the devops scripts and realise all the usage accounting, security configuration, deployment scripts and so on would need to be rewritten, and you have to go through compliance again if, hypothetically, you were to move on from AWS...
    - JBReefer 11y ago
jessriedel 11y ago
> Starbucks To Begin Sinister 'Phase Two' Of Operation > SEATTLE–After a decade of aggressive expansion throughout North America and abroad, Starbucks suddenly and unexpectedly closed its 2,870 worldwide locations Monday to prepare for what company insiders are calling "Phase Two" of the company's long-range plan.... > Though the coffee chain's specific plans are not known, existing Starbucks franchises across the nation have been locked down with titanium shutters across all windows. In each coffee shop's door hangs the familiar Starbucks logo, slightly altered to present the familiar mermaid figure as a cyclopean mermaid whose all-seeing eye forms the apex of a world-spanning pyramid. http://www.theonion.com/article/starbucks-to-begin-sinister-phase-two-of-operation-416 http://www.theonion.com/article/starbucks-to-begin-sinister-...
- guscost 11y ago
  Whoops, promoting your cynical humorous reference while this was trending might have caused a backlash, sorry. For the record I still want to buy Amazon stock someday.
tuna-piano 11y ago
Amazon's rationale for its lack of profits is well known... Why does this rationale not apply to its cloud business? Is the cloud business so good that it generates profits regardless of the investment it makes... or is the retail business so bad that it can't generate profits regardless of the investment AMZN makes in it?
- tomp 11y ago
  The retail business is competing with a very old, very established industry. The cloud business pretty much created a new industry.
  - pavs 11y ago
    I think its also true that their online retail store created a new industry. They might not be the first online retail store, but they definitely spearheaded the online retail industry. I think the some of the reason why AWS is more profitable or has been profitable longer because. - Amazon reinvested its revenue on its growth. - AWS was a by product of Amazon retail store infrastructure (at least initially). - AWS customer base are mostly businesses with big pocket and less likely to worry about spending money. - Amazon retail store is built on the business of selling products cheaper. - AWS profit margin tends to be higher than retail store. Just thinking out loud.
    - massysett 11y ago
      "spearheaded the online retail industry" "Online retail" is not an interesting category even if they did spearhead it. Amazon is nothing more than a catalog retailer, something Sears Roebuck and Montgomery Ward pioneered eons ago. Shipping goods to consumers out of a warehouse by common carrier is not a new industry.
      - cle 11y ago
        Neither is leasing out compute resources. The devil's in the details. Scale, convenience, ease of use...
deleted 11y ago
[deleted]
Quinner 11y ago
Why do people link to basic stories like this behind a paywall? If WSJ has an original piece out, fine, but this could've come from any one of a thousand sources. http://www.bloomberg.com/news/articles/2016-04-28/amazon-sales-top-estimates-as-fast-delivery-options-fuel-growth http://www.bloomberg.com/news/articles/2016-04-28/amazon-sal...
- downandout 11y ago
  WSJ subscribers probably don't even think about the paywall when they share it here, since they are already logged in. But that is what the "web" link is for. If you see a known paywall site, always just click on the web link.
  - phodo 11y ago
    You can always google the title and get around the paywall.
    - draw_down 11y ago
      No, that doesn't work anymore. edit: the /amp trick mentioned below works beautifully, however.
      - deleted 11y ago
        [deleted]
      - eclipxe 11y ago
        Googling for the title works for me.
        draw_down 11y ago
        I just saw that too. Now I don't know what to believe.
        11y ago
jerryhuang100 11y ago
so i guess my super super slow free-shipping orders (non-prime) from amzn as a result of their curbing capex?
hokuriku 11y ago
You know what this means, right? Jeff Bezos will increase investment into AWS and Blue Origin, while not investing anything into improving engineer work-life balance. Seriously, at least cover MSP and transit! Even partially covering a transit pass would be nice! Sincerely, an Amazon Vancouver SDE I
- serge2k 11y ago
  > Seriously, at least cover MSP Seriously? That's only what, 60 a month to cover it? Do you guys at least get vision and dental? Here in Seattle they give you benefits (I only used dental, it was fine for normal treatment) and an orca card (transit pass).
- makoz 11y ago
  Transit pass is partially covered as of last year in Vancouver. Unless something's changed, you might want to double check on the benefits for Vancouver. If I recall correctly you get approximately 80 dollars give or take.
- vehementi 11y ago
  I don't think the work-life balance issues at Amazon revolve around whether they pay for your transit or negligible medical fee
- plicense 11y ago
  Woah you're in Vancouver? If you don't mind me asking, what does the pay package look like?
cs702 11y ago
The most interesting tidbit for me is that Amazon would have reported losses without AWS. The AWS business generated $2.6B in revenues in the fourth quarter, which is only 9% of Amazon's total revenues of $29.1B; but operating income for the AWS business was $607M, or 118% of company-wide net income of $513M.[1] Without AWS, Amazon would have reported losses! [1] http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9NjMxNDUwfENoaWxkSUQ9MzM1OTQyfFR5cGU9MQ==&t=1 http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9N...
- izacus 11y ago
  Which means that they're using profits from an unrelated market to undercut and push out / destroy any competition in their storefront market. Not a good situation for future competition.
  - deleted 11y ago
    [deleted]
  - richmarr 11y ago
    How to you reach that conclusion from those numbers?
    - kuschku 11y ago
      Because that’s literally what they say? Amazon’s physical stores and Amazon’s online retail business are not profitable. They are selling below price. This is per definition predatory pricing. They are only able to offset this because AWS is making more profit. This is evident if you just look at the numbers.
      - Arnt 11y ago
        Perhaps it's correct but it's not evident from the numbers. The numbers can be acceptably explained by expansion, which Amazon does all the time. For example Amazon is just investing in a new retail business in India.

164 points by gist 11y ago

kimcheekumquat 11y ago

update: after hour currently at 675.01. Price increase +73.01 (12.13%)

coldcode 11y ago
With a market cap of half of Apple's they made ... 1/20 of the profit. For the first time ever.
- sangnoir 11y ago
  what are the growth prospects for Apple vs. Amazon? Market cap is influenced by speculators who want to buy low and sell high, and to them - the bigger the growth prospects, the better.

gist 11y ago

AWS currently improves product and cuts prices. My feeling is that as they mature over time and get even more of a lock on the market (and their customers) with the obvious lock in they have that will reverse and prices will increase over time resulting in even more profit than they reported today. Impossible to think this won't happen, especially with the differentiation they have with their product as well as the FUD of changing to a marginally less expensive provider (who will probably follow suit).

brianwawok 11y ago
Or another future - as more people see Google and Azure can compete... they build cloud agnostic software that treats providers as a utility, and profit margins fall and fall.
- mason55 11y ago
  > they build cloud agnostic software that treats providers as a utility It's like browsers all over again. As long as each provider is offering different things or different implementations of the same thing we will either need to choose one or be forced to go through a lowest common denominator translation layer. MSFT, GOOG, and AMZN are all smart enough to not turn this into a race to the bottom of who can provide the cheapest scalable instances. They'll all try to differentiate on features and so it's going to be a long time until you can treat these as a utility.
  - Will_Do 11y ago
    I think you're right in that Amazon Machine Learning and Azure Machine Learning will never be drop-in replacements for eachother. However, I would argue that VPSs are already drop-in replacements and I bet (though I have no proof) that VPSs are the majority of the market. The cloud providers may not have a viable way to provide even the perception of vendor lock-in when it comes to VPSs. Now it could be that prices and profits stay high anyways as the market is an oligopoly. The U.S. has experienced the same thing with mobile operators. This is also far from obvious though because entrance barriers for VPSs don't seem steep.
    - mason55 11y ago
      Sure, a basic VPS could be a drop-in replacement, but think of all the stuff that goes on with managing that. If you want to automate the creation of new servers then you have to script it or use something like CloudFormation or Troposphere. Either way you are immediately off the "drop-in replacement" path unless you build a middleware layer for your scripts. These guys make their money off the companies that need to be able to automate infrastructure and that stuff is becoming more, not less, fragmented.
      - falsedan 11y ago
        Terraform works with whatever cloud provider https://www.terraform.io/intro/vs/cloudformation.html https://www.terraform.io/intro/vs/cloudformation.html hint hint
jeffasinger 11y ago
One issue with this is the idea of competition from physical hardware. At some price point, if the prices are too high, it will be cheaper to hire extra people, and get a cage in a few datacenters and some physical hardware.
- bookmarkacc 11y ago
  The problem is people who arent big enough to have a whole data center. Or dont have the upfront capital even if its benefital in the longterm. They will still rely on Amazon.
  - Johnny555 11y ago
    You don't need to own a whole datacenter to own machines located in a datacenter, my company keeps machines in a 4 rack cage in a datacenter. (and plans to empty that cage by the time our contract runs out in September to finish the migration to AWS). Our AWS bill is just a bit higher than what we were paying for the cage rental + internet connectivity alone.
    - nopzor 11y ago
      That doesn't sound possible. Are you saying your raw bill for _just_ colo (ie. space and power) and bandwidth (ie. IP transit) was less than your _entire_ AWS bill? I've never heard of anyone take such an extreme stance.
      - Johnny555 11y ago
        The 4 rack cage plus extra power plus redundant network at a Tier I datacenter costs us close to $6K/month (including some block of remote hands hours). Even at our peak we didn't have the racks full, allowed room for expansion. Note that this cost includes only coloc costs, not server or network leases/purchases. We have very bursty traffic and run our baseload of ~ 30 severs (mostly m4.larges, with a few smaller utility servers as well as larger servers for back end services) most of the time, but when we need to scale, we ramp up to about 2 - 4 times that, but usually only for a few hours at a time. We also do some batch processing that takes a few high-memory servers for about a day each week. We monitor costs pretty closely and our monthly AWS spend is still less than the coloc fees, and we are much more scalable now and have multi-datacenter (AZ) redundancy, and by the end of the year, we will have a cold spare in a second region (which will cost us very little since it will be mostly powered off) We no longer need to vastly over-provision servers to handle our peak load and batch processing needs.
jonhohle 11y ago
One significant advantage of AWS is that they have a very large, built-in retail customer with relatively demanding requirements. I've always been under the impression that Microsoft doesn't really have a business that would lend itself to consuming its own services[0] and it's unclear to me whether or not Google uses their stuff internally. 0 - as an anecdote, I recall their salesmen coming to sell my employer their caching solution around 2008. I asked the rep I'd Microsoft was using their caching product on any of Microsofts web properties and he replied that they were not.
- abritishguy 11y ago
  Xbox live runs on azure
  - RubberShoes 11y ago
    So does iCloud ;) (and also runs on AWS) http://9to5mac.com/2016/04/11/apple-icloud-in-house-inspur/ http://9to5mac.com/2016/04/11/apple-icloud-in-house-inspur/
  - GeechieCloud 11y ago
    Certain, newer pieces of some of these services, such as the Azure Active Directory service at the heart of Office 365 and some of the newer, complementary Xbox Live services are hosted on Azure. But the core Bing, Office 365 Commercial and Consumer offerings and Xbox Live services are not hosted on Azure. (same article as above)
    - mrep 11y ago
      It seems like amazon is using an "all in" strategy which seems to be working out pretty well. They first focused on porting the entire amazon retail website onto AWS which I believe they completed in 2011. They also went "all in" with the service oriented architecture for AWS. Both of these have paid off quite handsomely. Granted, that hasn't always paid off (we all know how the fire phone turned out), but the wins have definitely made up for the losses.
- 11y ago

neom 11y ago

Go cloud go!!

serge2k 11y ago

On one hand I miss my RSUs on the other hand I do not miss working there. well maybe a little. it was fun for a while.

eva1984 11y ago
Same...But good to know that it is executing well. Go google cloud go! Bring AWS price down!! We need competition!!
- prohor 11y ago
  Google indeed seems the strongest competitor now for AWS, but there are far more providers who compete - see a comparison: https://www.cloudorado.com/ https://www.cloudorado.com/ . We just need to choose them to avoid monopoly or at least oligopoly.
  - serge2k 11y ago
    Google stronger than Azure?
    - eva1984 11y ago
      I think momentum wise yes... Google is more a service company than MS, and I believe it is more experienced in cloud technologies.
      - gareim 11y ago
        In terms of market share, Microsoft beats Google handily. In terms of year-over-year revenue growth, Microsoft is also beating Google, although Google's growth is better than I had expected. http://www.datamation.com/cloud-computing/microsoft-and-google-lead-in-cloud-growth-aws-rules-overall.html http://www.datamation.com/cloud-computing/microsoft-and-goog...
        bitmapbrother 11y ago

jonhohle 11y ago

May 15th is going to be a nice day for a lot of people ;-)

deleted 11y ago
[deleted]
laxatives 11y ago
What is the significance of May 15th?
- mabbo 11y ago
  Employee stock vesting day. If you get stocks granted as a bonus (most of us do), they vest in may and November. I know guys who've never sold any of their stocks. This will be literally $10k or more in their pockets, if they finally decide to sell.
  - eclipxe 11y ago
    Jeff just made $6.1B afterhours...
    - csomar 11y ago
      It's "papers" money. It's not cash until cashed out.
      - redblacktree 11y ago
        If he's giving any of his "paper money" away, I'm first in line.
    - hokuriku 11y ago
      The vesting schedule at AMZN is 5% after 12 months, 15% in 24 months, and 20% for every 6 months thereafter. For me (SDE I), that works out to $2200 in year 1 and a projected $7000ish in year 2. MSFT, on the other hand, has their stock vests 25% after 12 months and 25% for every 12 thereafter.

DasIch 11y ago

Is there any reason why Amazon would suddenly "waste" money on profit? Could this be an indication of a change in strategy or is this just a temporary thing?

r00fus 11y ago
Bezos will hold a press conference "We are sorry we did not realize we would make as much money as we did - consequently our spending just could not keep up" while AMZN tanks.
- mabbo 11y ago
  Bezos's goal seems only to be Amazon's growth and efficiency. I'm really starting to believe that being one of the 10 richest people on the planet was just a happy side-effect that only distracts him from his goal.
laxatives 11y ago
There should eventually be some time when Amazon does finally cash out, presumably on some timeline as a function of Bezos's mortality. Its unrealistic to be around forever. How many companies last hundreds of years? How many tech companies last decades?
- serge2k 11y ago
  > How many tech companies last decades? Amazon is at 2 decades and going strong. Any reason to think they won't last a long time?
  - discodave 11y ago
    My prediction is AWS will split after Jeff dies (or is otherwise not involved in the company). Then Amazon retail will split from Amazon logistics, and so on.
- ycombobreaker 11y ago
  Microsoft is 40 years old. IBM is 100. Some other old companies might not be considered "tech" anymore, but only because their market/product are better defined (e.g. Ford is an auto maker, but the assembly line and the concept of an automobile itself place Ford as the "tech" darling of 110 years ago, IMHO). I think if you don't see old tech companies today, it's because over time their public appearance has quietly lost the "how" (new technology, automation) and only left the "what" (search, ipods, advertising, rockets). But that doesn't mean old tech companies die.

cosmoharrigan 11y ago

It's interesting to note that Amazon third-party seller unit share is at 48% of total units shipped, which is a record high. It has grown by 1% per quarter for the last 4 quarters in a row.

abhi3 11y ago
Does this share included international sales? If so it could have something to do with Amazon growing in India where it has to route all sales through a third party. http://www.livemint.com/Companies/RjEDJkA3QyBSTsMDdaXbCN/Amazons-JV-Cloudtail-is-its-biggest-seller-in-India.html http://www.livemint.com/Companies/RjEDJkA3QyBSTsMDdaXbCN/Ama...
draw_down 11y ago
I don't really like how they sell things from third parties on there. If it's sold by someone else and fulfilled by Amazon that's ok, but otherwise the whole point of buying on Amazon is to not have to deal with weirdo possibly-shady little retailers.
- hga 11y ago
  Amazon is selling trust there; in my experience, if the seller has a 96% or better rating you'll seldom be disappointed when it arrives, and they'll work hard to give you satisfaction if you aren't. Much better than eBay in my family's experience.
- tracker1 11y ago
  If you have Prime, and click on that as a filter, that gives you fulfilled by amazon results... A lot of times I'll go another step and choose Amazon.com as the seller.
- cosmoharrigan 11y ago
  Amazon is pushing very hard to increase Fulfillment by Amazon coverage across the catalog, and is also releasing new products such as Seller-Fulfilled Prime. The customer experience is tightly controlled in both cases.

redorb 11y ago

honestly - stuffing video in with prime then raising the price. recently offering video stand alone but for $9 more a year than prime (with video)... Hard to tell who is actually shipping an item - sketchy pricing based on region / or account etc.. why trust them with aws? it seems their strategy is to price things stupid low - get you on board then raise it when they think they 'got you by the balls' no thanks

andrewstuart2 11y ago
Jump on board, but don't wear the shackles! Use something like Kubernetes and FOSS projects and you can shift to whomever has the cheapest VMs today. Easier said than done, I know, but a fine goal to have, I'd say. :-)
- xyzzy123 11y ago
  I totally agree with you in the ideal case. Problem is in some ways, AWS is too awesome due to all the add-on services. Systems are more than just compute, and the last 3 companies I've worked for have become increasingly coupled to AWS over time due to use of the add-on services. You build your system and over time you need message queuing, ability to send emails, databases, load balancing... You can run / build these yourself but do you want to use up your team's bandwidth setting up say, postgresql replication ... or just use RDS? If you use third-party (e.g. out of AWS) services, you lose the ability to do security with say, instance roles and in larger orgs you lose time to the "new vendor due diligence" process and getting the business to sign off on new support contracts etc. Maybe you also need some new automation tooling. Because all that business-ey stuff is already in place with AWS and administering say, event queues, is sure not core business, most project teams will SaaS that capability if they can. Whatever service is already in AWS ends up being the no-brainer answer. So hard to avoid architectural coupling. Then you look at the devops scripts and realise all the usage accounting, security configuration, deployment scripts and so on would need to be rewritten, and you have to go through compliance again if, hypothetically, you were to move on from AWS...
  - JBReefer 11y ago

jessriedel 11y ago

> Starbucks To Begin Sinister 'Phase Two' Of Operation > SEATTLE–After a decade of aggressive expansion throughout North America and abroad, Starbucks suddenly and unexpectedly closed its 2,870 worldwide locations Monday to prepare for what company insiders are calling "Phase Two" of the company's long-range plan.... > Though the coffee chain's specific plans are not known, existing Starbucks franchises across the nation have been locked down with titanium shutters across all windows. In each coffee shop's door hangs the familiar Starbucks logo, slightly altered to present the familiar mermaid figure as a cyclopean mermaid whose all-seeing eye forms the apex of a world-spanning pyramid. http://www.theonion.com/article/starbucks-to-begin-sinister-phase-two-of-operation-416 http://www.theonion.com/article/starbucks-to-begin-sinister-...

guscost 11y ago
Whoops, promoting your cynical humorous reference while this was trending might have caused a backlash, sorry. For the record I still want to buy Amazon stock someday.

tuna-piano 11y ago

Amazon's rationale for its lack of profits is well known... Why does this rationale not apply to its cloud business? Is the cloud business so good that it generates profits regardless of the investment it makes... or is the retail business so bad that it can't generate profits regardless of the investment AMZN makes in it?

tomp 11y ago
The retail business is competing with a very old, very established industry. The cloud business pretty much created a new industry.
- pavs 11y ago
  I think its also true that their online retail store created a new industry. They might not be the first online retail store, but they definitely spearheaded the online retail industry. I think the some of the reason why AWS is more profitable or has been profitable longer because. - Amazon reinvested its revenue on its growth. - AWS was a by product of Amazon retail store infrastructure (at least initially). - AWS customer base are mostly businesses with big pocket and less likely to worry about spending money. - Amazon retail store is built on the business of selling products cheaper. - AWS profit margin tends to be higher than retail store. Just thinking out loud.
  - massysett 11y ago
    "spearheaded the online retail industry" "Online retail" is not an interesting category even if they did spearhead it. Amazon is nothing more than a catalog retailer, something Sears Roebuck and Montgomery Ward pioneered eons ago. Shipping goods to consumers out of a warehouse by common carrier is not a new industry.
    - cle 11y ago
      Neither is leasing out compute resources. The devil's in the details. Scale, convenience, ease of use...

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Quinner 11y ago

Why do people link to basic stories like this behind a paywall? If WSJ has an original piece out, fine, but this could've come from any one of a thousand sources. http://www.bloomberg.com/news/articles/2016-04-28/amazon-sales-top-estimates-as-fast-delivery-options-fuel-growth http://www.bloomberg.com/news/articles/2016-04-28/amazon-sal...

downandout 11y ago
WSJ subscribers probably don't even think about the paywall when they share it here, since they are already logged in. But that is what the "web" link is for. If you see a known paywall site, always just click on the web link.
- phodo 11y ago
  You can always google the title and get around the paywall.
  - draw_down 11y ago
    No, that doesn't work anymore. edit: the /amp trick mentioned below works beautifully, however.
    - deleted 11y ago
      [deleted]
    - eclipxe 11y ago
      Googling for the title works for me.
      - draw_down 11y ago
        I just saw that too. Now I don't know what to believe.
        11y ago

jerryhuang100 11y ago

so i guess my super super slow free-shipping orders (non-prime) from amzn as a result of their curbing capex?

hokuriku 11y ago

You know what this means, right? Jeff Bezos will increase investment into AWS and Blue Origin, while not investing anything into improving engineer work-life balance. Seriously, at least cover MSP and transit! Even partially covering a transit pass would be nice! Sincerely, an Amazon Vancouver SDE I

serge2k 11y ago
> Seriously, at least cover MSP Seriously? That's only what, 60 a month to cover it? Do you guys at least get vision and dental? Here in Seattle they give you benefits (I only used dental, it was fine for normal treatment) and an orca card (transit pass).
makoz 11y ago
Transit pass is partially covered as of last year in Vancouver. Unless something's changed, you might want to double check on the benefits for Vancouver. If I recall correctly you get approximately 80 dollars give or take.
vehementi 11y ago
I don't think the work-life balance issues at Amazon revolve around whether they pay for your transit or negligible medical fee
plicense 11y ago
Woah you're in Vancouver? If you don't mind me asking, what does the pay package look like?

cs702 11y ago

The most interesting tidbit for me is that Amazon would have reported losses without AWS. The AWS business generated $2.6B in revenues in the fourth quarter, which is only 9% of Amazon's total revenues of $29.1B; but operating income for the AWS business was $607M, or 118% of company-wide net income of $513M.[1] Without AWS, Amazon would have reported losses! [1] http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9NjMxNDUwfENoaWxkSUQ9MzM1OTQyfFR5cGU9MQ==&t=1 http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9N...

izacus 11y ago
Which means that they're using profits from an unrelated market to undercut and push out / destroy any competition in their storefront market. Not a good situation for future competition.
- deleted 11y ago
  [deleted]
- richmarr 11y ago
  How to you reach that conclusion from those numbers?
  - kuschku 11y ago
    Because that’s literally what they say? Amazon’s physical stores and Amazon’s online retail business are not profitable. They are selling below price. This is per definition predatory pricing. They are only able to offset this because AWS is making more profit. This is evident if you just look at the numbers.
    - Arnt 11y ago
      Perhaps it's correct but it's not evident from the numbers. The numbers can be acceptably explained by expansion, which Amazon does all the time. For example Amazon is just investing in a new retail business in India.