“Bezos has chosen to run Amazon to be the biggest, most powerful and successful retailer on Earth 20 years from now. Any fool could run it profitably today.”
That’s the quote of the week about Amazon, from London-based analyst Benedict Evans in a great New York Times piece about the company this week. The sentiment helps explain the long-term bet that many investors are making in the company, and why Amazon’s share price continues to rise despite profits that range from slim to none.
Looks like that exercise in patience will need to continue today. Amazon reports quarterly earnings this afternoon, and analysts polled by Thomson Reuters believe the company will lose 10 cents a share despite a 21% increase in revenue, to $16.8 billion.
Unless Amazon can pull off a surprise, it would be the second straight quarterly loss for the company. Here’s a chart from Amazon’s previous earnings report, showing the trend.
Among the factors contributing to higher expenses: Amazon has been investing heavily to build up its distribution infrastructure in both the physical and digital realms, with new warehouses and a revamped tablet lineup. The company is also likely to report more than 100,000 employees for the first time in its history, continuing its rapid growth.
As noted by the Wall Street Journal, analysts are likely to grill Amazon finance chief Tom Szkutak about the reasons for the increase in the company’s threshold for free Super Saver Shipping, which was boosted to $35 from $25 earlier this week. Plans for expanding the Amazon Fresh grocery delivery service are another likely topic.
Amazon reports earnings after the market closes. Check back for coverage on GeekWire.
