Amazon Posts Surprise Loss

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July 25 (Bloomberg) -- Cross Ledge Investments Co-Founder Lori Wachs and Bloomberg's Jon Erlichman and Brad Stone dissect Amazon's earnings report with Pimm Fox on Bloomberg Television's "Taking Stock." (Source: Bloomberg)

What started -- what jumped out at you?

His company had a loss.

People were expecting a profit.

As a forecast ahead, they were -- they could lose a lot more money.

Some were looking for a profit.

This is the same old story from amazon.

The company that muscles its way toward really impressive sales, they suggest they could be north of $17 billion in the third quarter.

Doing so at the expense of profit pretty debate with a amazon is whether and not doing that, building a moat around its business, doing the spending on infrastructure, building distribution centers so they can get stuff to you faster, if it is ultimately going to be a much more profitable story.

That depends on how profitable those e-books and movies they are investing in our for the business.

I am sure that is where i love the questions are going to come from going forward.

Do you consider a successful online retailer?

They certainly have made life difficult for many other written mortar retailers.

I virtue of that, they are tremendous.

Look at the volume of what they do.

Every retailer i look at has to figure out how to better make himself somewhat protected by the threat they pose to all of them.

Brad stone, how do companies compete against them, when amazon does nothing to worry that much about making a profit?

It is a conundrum.

The worst thing is the amazon shareholders do not seem to care.

The stock is down today.

They have tremendous resilience.

Amazon has done a good job of broadcasting the fact that they are in the investment cycle.

They're going to spend a lot of money.

They figure but they are best at, they double down on that pretty the figure out what amazon can copy.

Can you give us examples of retailers are doing well online?

I think norstrom's has done a fantastic job.

They were the first one out there with free shipping and free returns.

They took out of the equation.

Something they can offer that amazon cannot is pick it up at the store premier able to fight back with with that.

I seek the -- he company for carbon outfitters -- i see companies like urban outfitters.

Other retailers look at the lens of just what can they fit inside the store predicted at a lot more when it is just in our online inventory.

Amazon does more than just retail.

It offers cloud services to other companies.

How important is that to the company?

It is small right now.

It is probably not important to the bottom line.

He continued to lower prices on all of their services.

They are the industry leader.

They created the enterprise cloud services space.

They are growing.

It is estimated to be $2 billion this year.

A lot of momentum.

They can fight off ibm.

It is one of those reasons why shareholders have a lot fate.

Investors do not seem to mind that amazon doesn't make a profit in the quarter that just ended.

How long can it go on?

It has been going on a long time.

Just to follow-up, with web services, here is a business that in this quarter generated -- nine percent of the total north american revenue.

Who knows how much amazon web services is at that amount brady given how much revenue the company generates, there is a lot of money.

I think that the point, you can't look at amazon as a traditional retailer.

That might be why people are curious about in a big way.

They don't position google as just a company focus on search.

Amazon is doing what netflix is doing.

A little bit of what apple is doing.

I think they look at them in a different light.

I want to thank you very much.

Jon erlichman, and our thanks to

This text has been automatically generated. It may not be 100% accurate.


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