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Amazon Comes Up Short. Apple’s Fine
Amazon reported sales for Q2 that missed estimates on Thursday afternoon in the US. The company's current-quarter revenue guide looked short of consensus too.
Andy Jassy grew the top-line by 10% last quarter, when revenue was $148 billion. That was better than the mid-point of the company's guide from three months ago, but the Street was looking for $148.78 billion. If you strip out currency effects, sales grew 11%.
For Q3, Amazon guided for between $154 billion and $158.5 billion in sales. Ta
Thanks for the insightful comments.
FYI – “Service” revenues is whre Apple includes the payola Google pays Apple to be included as the preferred search vendor. Something like $21 billion annually. (Estimated because the company refuses to publically itemize it.) That is under threat because of a Google antitrust court decison which will be released, hopefully by the end of this month.
Just something to be aware of.
Well, well, well…. the judge released the court’s verdict a little ahead of time. Great timing for a market already on its heels.
“Apple gets by far the biggest revenue chunk from Google, Daryanani said, noting that Apple receives about $20 billion as a result of its deal with Google. “[The] payment falls almost entirely to pre-tax profit, so it would represent an about 15% earnings headwind if the payment goes away,” Daryanani wrote, adding that this was the one antitrust case involving Apple that he believes could pose a material risk.”
As of 8/2, 69% by name/61% by cap of the S&P 500 has reported 2Q. 60% by name/73% by cap beat cons rev, 81% by name/87% by cap beat cons EPS. 42% by name/49% by cap saw 3Q cons rev go up, 38% by name/34% by cap saw 3Q cons EPS go up. Average price reaction was 0.0% by name/-0.2% by cap.
Compare to this point for 1Q (as of 5/3), 75% and 72% reported 1Q, 62% and 71% beat rev, 81% and 88% beat EPS, 41% and 36% rev go up, 40% and 48% EPS go up, 0.0% and 1.0% px reac.
I would worry if AWS wasn’t doing well. I wonder if people who aren’t in technology understand just how much of the world’s information infrastructure lives in Amazon datacenters. I don’t have numbers but the view from the trenches is that they’re the big daddy, comparable in that arena to what Google is in web search, or what Hershey is to chocolate bars… the first name people think of. I would have to imagine that division’s health is a barometer for the health of the online world in general, and the business world that depends on it.