Amazon leaves traders in jungle without a guide
Last night's call was a stunning reflection of how little the retailer cares about the whole process of reporting results.
Would it kill Amazon (AMZN) to answer one question with a helpful answer? Does the company have to stonewall endlessly and say whatever question is asked isn't relevant or isn't something the company cares about or monitors?
Last night's call was a stunning reflection of how little Amazon cares about the whole process of reporting results. First, the company reports its widest loss in two years, then makes it clear in the call that:
- It doesn't matter.
- It is a good thing anyway, because it is spending and ramping and ramping and spending.
As my friend Arum Rubinson at Wolfe Research pointed out in a terrific note this morning, "the word 'invest' was mentioned 33 times" on the call and "the only thing missing is a clear sign that the investments are paying dividends."
There were actual weaknesses, notably in the now very competitive Web services business, but Tom Szkutak, the brief or taciturn chief financial officer, made it clear that they were planned weaknesses or at least foreseeable weaknesses. At least he didn't say "fortunate weaknesses."
The company simply cut price to keep business, and it is clear it kept a lot of business but unclear whether it actually did make it up in volume, because it isn't going to help you figure that out.
Some people were freaked out by the guidance, which seemed well off the mark. But then again, I don't even know if the company takes the guidance process seriously anymore, so maybe it's some sort of dodge. No way to tell. Pretty zany.
I will say this about Szkutak: He's an equal-opportunity stonewaller. Some of the analysts seemed eager to gin up some positives, notably that gross margins seemed to have improved, but Szkutak would have none of it, saying Amazon doesn't focus on them.
Geez, I focused on them when I had a lemonade stand with my mom at 1401 Cromwell Road in Wyndmoor.
Nor did he even bother to suggest other than in passing that more people signed up for Amazon Prime this quarter than last year, despite the price increase. I remember when that was a worry factor.
A worry misplaced.
In fact, the only thing I really got out of the call was how much trouble Japan is in when the country put in that stupid retail tax earlier this year. The decline in spending was so noticeable that it hit whatever bottom line Amazon actually cares about, not that it would deign to tell us by how much. Maybe that's why revenue growth decelerated to 21.6 percent from 22.8 percent? Who knows?
In the end, this is a company that doesn't deserve to sell at these prices, simply because it is such an imperfect security. It deserves a big discount, not a premium.
No matter. The big-boy momentum funds will stay the course, and the people who love the service will keep buying. I imagine after the stock settles down the bulls will come out and say next quarter is, indeed, the breakout quarter when we will see the spending pay off. We sure didn't see it pay off this quarter.
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Pretty by saying that they really mean it is important and it's very relevant but if I give you the answer it will hurt me and maybe even get me thrown in jail so I will not answer
Remember a criminal trial I was at this lady obviously on welfare had two kids and one on the way and was caught for the third time stealing diapers and formula for her kids. The DA and Judge were trying to put her away for 7 years and send her kids to foster care and when I asked how much the prison and child care would cost over seven years they said it was not relevant.
Considering this is Texas and welfare only pays like $385 a month first kid and lower each additional kid I thought it was very relevant as they were only giving her about $700 a month for the kids or about $8,000 a year now they were about to put her in jail $80,000 a year and foster care for the rest of the kid's childhood another $10,000 a year for 3 kids a year and cost of medical another $4,000 per her and each kid -- total of about $102,000 a year an increase of the $8,000 they were spending currently.
Seems to me if they had a proper welfare job training program to train her and have some other welfare moms trained to look after her kids and get her a good job about $45,000 a year after training that it would be cheaper than throwing her in prison but then the Judge and DA could not get a $2,000 kick back from the private prison for giving them a prisoner.
What a waste of a human being and all that money
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