![]() How fast are infections growing? According to the Washington Post, over the past month, “Covid-19 cases quadrupled, prompting public health authorities to recommend that vaccinated people resume wearing masks indoors in high-risk areas.” If that happens, we could return to the social distancing measures that prevailed in 2020 before Covid-19 vaccines were widely available. will not go back to social distancing.Īt the rate Covid-19 infections are increasing, it would not surprise me to see hospital intensive care units approaching capacity. That’s because it appears to me that Amazon’s lower growth expectations are based on the assumption that the worst of the pandemic is behind us and the U.S. One thing that could help Jassy is that those dramatically lowered growth expectations could make it easier for Amazon to exceed expectations when it reports its third quarter results. I think Jassy missed an opportunity to begin to communicate his plans for Amazon’s future now that he has been CEO for the last three weeks. Jassy - who did not attend the earnings conference call - issued a statement in which he told Amazon employees - its headcount has increased 52% to 1.33 million in the last year- that he was “very excited to work with you as we invent and build for the future.” With its customers taking vacations in 2021, Olsavsky expects them to “do other things besides shop.” As Brian Olsavsky told investors, in the middle of May 2020, Amazon’s growth rates jumped to a range from 35% to 45%. Revenues at AWS - 13% of Amazon’s total revenue - increased 37% to $14.81 billion $601 million more than analysts estimated.Īmazon’s CFO attributes the growth slowdown to a drop in demand compared to the 2020 lockdown due to Covid-19. For example, Amazon’s “other” unit - 7% of total revenue - which sells subscriptions and advertising - grew 87%. Two of its non e-commerce businesses did nicely. “Sales in Amazon’s online stores grew just 13% in the quarter to $53.16 billion from $45.9 billion a year ago in the same quarter, while analysts on average expected $57.35 billion, according to FactSet,” noted MarketWatch. Its online stores slowed down dramatically. Unfortunately, Amazon’s faster-growing business lines - “Other” and AWS - are not large enough to offset the slowdown in its online sales growth. However, Amazon’s revenue was $2.4 billion below what analysts surveyed by Refinitiv expected and its revenue growth was much slower than the 41% surge it enjoyed in the second quarter of 2020, according to CNBC.įor the third quarter, Amazon estimates revenues in the range of $106 billion to $112 billion - the midpoint of which represents 13% growth, according to the Journal, and about $10 billion below the consensus estimate. How so? According to CNBC, Amazon revenues grew 27% to over $113 billion and it exceeded EPS estimates by 23% earning $15.12. ![]() Were it not for the way Wall Street brackets companies by its expectations, Amazon’s results are exceptional.
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