Amazon Quarterly Results Smash Estimates By Big Margin

From Investors Business Daily:

Amazon reported second-quarter results late Thursday that blew past Wall Street estimates as the pandemic continues to present the company both challenges as well as opportunities. Amazon stock climbed.

The company reported adjusted earnings of $10.30 per share on revenue of $88.9 billion. Wall Street expected earnings of $1.48 on revenue of $81.4 billion,

Amazon stock jumped 5%, near 3,205.50, during after-hours action on the stock market today.

Revenue climbed 40% from the year-ago period, its strongest growth in nine quarters. Earnings powered above estimates even though it spent $4 billion during the quarter on coronavirus-related costs as previously announced. In addition, the company plowed more than $9 billion in capital projects, including fulfillment, transportation and Amazon Web Services.

Operating income increased to $5.8 billion in the second quarter, compared with $3.1 billion a year ago.

. . . .

Over the past several months, the pandemic has led to an elevated usage of e-commerce platforms due to convenience and a large number of retail store closures and bankruptcies. Amazon has been hiring furiously to keep up with demand.

. . . .

Amazon said it increased grocery delivery capacity by more than 160% and tripled grocery pickup locations. Online grocery sales tripled in the second quarter when compared with the same period last year.

Link to the rest at Investors Business Daily

18 thoughts on “Amazon Quarterly Results Smash Estimates By Big Margin”

    • I’ll give Foer credit for acknowledging his economics are in line with 1908 Progressives. But, while he criticizes the consumer oriented anti-trust under which more people have achieved more prosperity than under any system in history, he fails to acknowledge the 1908 Progressives were firmly on the side of producers rather than consumers. So is Foer.

      Brandeis told us consumers should be willing to pay more so less efficient suppliers could prosper. Sounds much like Mark Coker. Foer agrees. The key to the Progressive econ Foer advocates is that experts like Foer should decide for everybody who should be allowed to produce, and who should be allowed to consume.

      Why? Because the rest of us lack the intelligence, education, knowledge, and experience to know what is in our own best interests. But Foer and his fellows aren’t subject to such limitations. They know what is best for us all. It’ the same 1908 Progressive movement, but few even know.

  1. Amazon earns its money by being better than its competitors.

    Bezos was a little fish when he started selling books online. I don’t recall ever seeing anyone who claimed Amazon violated any laws or bribed any public officials to gain special advantages as they grew.

    In a regulatory state/nation, smart business people hire lawyers to help them do business profitably while not violating any laws or regulations. If a competitor attempts to obtain a regulatory or legislative advantage, smart business people hire Washington lawyers and/or lobbyists to help prevent that sort of thing from being written into the law or regulations that govern their business.

    The purpose of antitrust laws is to protect competition, thereby ultimately benefiting individuals. Its purpose is not to protect particular competitors that don’t please their customers as much as another businesses do.

    I’m not aware of anything Amazon does that doesn’t delight 99% of the people in the United States.

    Anyone can start an online business that sells products or services, just like Bezos did. In doing so, they’ll be competing with everyone else online to provide good products and/or services that customers want for a good price.

    Bezos started his business in his garage with some boxes of books, competing by offering readers a lower price and wider selection than they could get at their local bookstore. If the local bookstore was 50 miles away, Bezos made it a lot more convenient for isolated booklovers to buy the kinds of books they wanted than any New York publisher or major book distributor did.

    • The politicians’ real gripe is that Amazon is too successful an example of entrepreneurial capitalism, as oppossed to state capitalism, dirigisme, kleptocracies, or especially socialism.
      It raises the ever embarrassing question of “If he did it, why not their competitors?” Makes their campaign contributors and memoir publishers look bad.

      Their excuse is that Amazon uses their sales data to decide which products are worth doing house brand versions.

      The song and dance is just starting.

      If you think this is bad, wait until Elon Musk gets STARSHIP flying daily. Or even weekly. If they think Amazon is disruptive, wait until they see what $10 a pound spaceships do.

      • The politicians’ real gripe is that Amazon is too successful an example of entrepreneurial capitalism

        Their real gripe with Amazon is Bezo’s Washington Post. Nothing will come of these hearings because the internet companies are allied with the democrats. Why would they turn on their allies?

        • They were whining long before the Post. Focusing on that is both facile and inaccurate.
          And the biggest whiners are supporters of the post. Not the Orange guy.
          The Orange guy didn’t torpedo the NYC part of HQ2.
          Or arrange the hearings in the *House*.
          Or propose the confiscation of annual chunks of his money.

          These are leftists going after a leftist.

          • They are still going to do nothing because the tech companies are the democrats’ political allies. Whining will continue. It’s cheap, easy, and millions believe it.

            • The previous guy in the WH was overheard saying, “If we fix that, we won’t have the issue for the election.”
              So, no.
              Nothing will happen. They need the issue to posture.

              If they *really* wanted to do something, Facebook and Google are in tbe communications business, so there is precedent. Apple, less so.
              Amazon, none.

              Amusingly, the real big disrupters today are Nadella and Musk and both are sailing by unnoticed.

    • Amazon does do a lot of things right. But there is definitely room for improvement.

      Discovery (especially search) sucks. I believe Amazon has given up trying to compete in the industrial space; finding a computer part on Newegg or electronics part on Digikey or Mouser is amazingly easier.

      Putting all kinds of products (sometimes not related) on a page sucks, especially if you can’t separate the reviews. At times I’ve skipped buying from Amazon because it’s hard to tell what I’m really going to get.

      Pricing on Amazon can be way out of whack (to be fair, most of the time it’s third party sellers).

      Although they’re still useful, need to look at reviews with a healthy dose of skepticism.

      • There’s an opening for a smart, agile competitor to try a different way.

        I’m a huge Amazon fan, but, for anything major, I tend to check Walmart and Costco.com for their prices to see if Amazon is the best deal. Fortunately, each of those two Amazon competitors have retail locations close by. The last time I checked, Walmart didn’t charge for shipping (at least for some items) if you’re willing to pick up the item at their store.

        • We shop around too. Amazon doesn’t even necessarily offer the best selection once you are faced with thousands of choices. What you want might be in there, if you can find it. I have had better luck finding casual furniture, such as a coffee table, from Target. That is where we got our patio furniture too. Conversely, for some types of items, such as a California King size comforter, Amazon has presented acres of choices and other retail outlets, not so much. Costco is good for some things provided you go in there every week and only buy what you need – the last time I was there I bought a pair of shoes for $15. Size 11 fit me, and it’s a good thing because that’s the only size they had. At least I didn’t have to buy two pairs shrink-wrapped together. The next week they were all gone. That is Costco.

          I have a local hardware store that is always my first stop. I shop online for groceries through a local chain, that picks them and puts them in my trunk when I park behind the store and text them. There are plenty of alternatives to Amazon, and plenty of defensible reasons to use them, beyond the thoughtless “Amazon is big, and their warehouse workers never get to sit down” meme.

          Standard Oil was a monopoly. At their height, in much of the country, you could not buy or sell oil without doing business with them. Ma Bell was a regulated monopoly. If you wanted phone service, that was it. (landline phone service is still a regulated monopoly.)

          Amazon isn’t a monopoly. Anything you want to buy, you can buy from some other company than Amazon.

          • The odd thing about Standard Oil is it kept buying up competitors. Many would just go down the road, start up again, and get bought again. So, we have to ask, how can Standard have been a monopoly with no barriers to entry?

            I’m still waiting for an example of a retail monopoly. I’d love to see one.

      • And I look at all online reviews with a dose of skepticism.

        I understand some of the Chinese sellers on Amazon really work to boost the reviews for their products.

  2. I’m watching with interest because I see a source of competition to Amazon rising: small local businesses going on line, mostly on the Shopify platform. For small retailers who have a local following, selling on Amazon is possible, but not ideal for retailers whose sales strategy is “come to my shop and see what I have for you today,” with the corollary, “trust our judgement and skill to seek out the best for you.” A small local farm produce shop is a good example. That may be a niche, but when I look at what my household purchases each week, Amazon is only one part of the picture

    Amazon sales may be rising, but I wonder how much among experienced online shoppers? Having been Amazon enthusiasts for 20 years, we’re about maxed out on Amazon. We shop more online with the virus worries, but our Amazon purchases are staying constant– actually declining slightly because Amazon deliveries in our area are not what they used to be. Packages delivered on time have become exceptions, no longer the rule. Packing is often a bit sloppy. I’ve noticed we have opted for buying from a local store online and using curbside pickup a few times for stuff we would have just ordered from Amazon 6 months ago. Ordering a list of small hardware online and picking up curbside a half hour later is my new normal. Texting a photo of my problem to my neighborhood plumbing supply guy and picking up his solution at the curb works remarkably well.

    Things are changing.

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