Amazon.com, Inc. (AMZN) Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 232.56

-0.8%

3:10 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: James Young who wrote (11356)	7/22/1998 7:37:00 PM
From: Rob S.	Read Replies (3) of 164684

OK, I'm finished with the other call and can post some stuff on the Amazon.com call. To dispense with it: No, there is not a recorded play-back of the cc. Investors should call the company themselves and either try to get on the cc or get them to provide a recorded play-back. It does no good that I can see to complain on this board on the day it takes place. I think that the vagueness of Amazon's communications with investors helps speculation to run rampant. I took several pages of notes on the cc and recorded most of it. Here's stuff from the cc: Jeff Bezo and Joey Covey started off with some opening statements. They issued repeated strong warnings including the following: "It is still early-on in the development of internet commerce . . . we do not expect growth rates to continue at historical rates." "It is extremely unlikely (emphasis made by Bezo) that the company will be able to maintain the same level of market share . . . as the business grows further . ." "It is extremely unlikely that Amazon can maintain the same growth rate . . ." "It is impossible to predict the impact of new competition several quarters in the future . . . we urge caution in enterpreting current levels of growth . . ." The company experienced sales of $115.9 million compared to year-ago sales of $27.8 mil. which was a 317% increase. This healthy growth for the quarter was attributed primarily to internet growth and aggressive advertising and promotion efforts. Although the growth was on tract with expectations, it was a continued deceleration from previous quarters. Per customer acquisition costs increased both in absolute dollars and as a percentage of sales. Bezo said that they were very pleased with the acceptance of music sales and received some music only business in addition to sales to existing book customers. In response to a question from an analyst at Goldman Sach's, Bezo said that Amazon would be more likely to bring out new products in the areas of books, music and videos and continue expansion in Europe and other international markets. In this context, Amazon.com sees acceptance of on-line commerce occuring more slowly in Europe as they are perceived to be 2-3 years behind the US in general acceptance of e-commerce. Another limiting factor to expansion is what Bezo termed limitations in "executive bandwidth" or the ability to effectively manage new ventures profitably (my comment: or at current levels of losses). He went on to say that Amazon.com would attempt to not do a half-hearted effort, preferring not to do the venture at all. I think this is a reasonable approach to new product areas; many of those that have been suggested for Amazon.com to get into would provide limited profit opportunities and would be met with more highly capable and technically savvy competition than the still relatively virgin book e-tailing area. Amazon.com sees the music business as being more diverse and competitive (compared to the relatively staid book business, not a doubt about it!). Bezo said, "It is unlikely that the music business will ever be as profitable as the book business". "We expect lower margins and more aggressive competition than we are seeing in the book business." In response to analysts questions, Joey Covey, CFO, said that customer acquisition costs were higher than the company had expected. -------- I'll break here and post some more after I break a bit. More to follow on expected needs for infrastructure and personnel expansion and immediate sales expectations.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next