Q2 2016 – Amazon Earnings Call Summary

Below are my key takeaways from the Amazon Q2 2016 Earnings Call on July 28

Summary:

Net Sales increased 31% to $30.4B in the quarter vs. $23.2B YoY.  Operating Income was $1.3B vs. $0.464B in Q2 2015.  And Net Income was $0.857B vs. $0.092B last year Q2.

The 2nd annual Prime Day was a huge success with sales up 60% YoY.  It was the biggest day ever and a record day for Amazon devices.

Amazon Fresh launched in London and Boston. It’s now found in California, northern New Jersey, Baltimore, New York, Philadelphia and of course, Seattle.

In India, Prime, with unlimited free shipping, was introduced and a new AWS Region was launched.  Amazon.in was the most visited e-commerce site in the country.

Introduced a new $79.99 Kindle, which is thinner and lighter than the previous generation, and includes built-in Bluetooth audio support and the VoiceView screen enables visually impaired users to read books without an adapter.

Amazon Studios received 16 Emmy nominations, with another nom for Transparent in the Outstanding Comedy Series category. Won four Daytime Emmy awards for Original Kids Series (Tumble Leaf, Niko and the Sword of Light)

Launched Amazon Direct, a way for creators to make their video content available to Amazon customers.

Amazon Prime Air and the U.K. government partnered to allow the safe use of drones for small parcel delivery.

Financial Metrics:

  • Total Net Sales: $30,404MM, +31.1% YoY
    • Q2 2015: $23,185MM
    • Net Product Sales: $21,116MM, +23.5% YoY
      • Q2 2015: $17,104MM
    • Net Services Sales: $9,288MM, +52.7% YoY
      • Q2 2015: $6,081
  • Operating Income: $1,285MM, +176.9% YoY
    • Q2 2015: $464MM
  • Net Income: $857MM, +831.5% YoY
    • Q2 2015: $92MM
  • EPS: $1.81, +805% YoY
    • Q2 2015: $0.20

Subscribers:

  • As of Q1 2016, 300MM global active users in Prime, not updated for Q2

List of Key Properties:

Forward Thinking:

  • Tripling original content second half of year for Prime: e.g. Transparent, Mozart in the Jungle, The Man in High Castle and first seasons of Good Girls Revolt, THe Grand Tour and Woody Allen’s first ever TV series
  • Launching in theaters: Manchester by the Sea, The Handmaiden and Gleason
  • Prime video launching in India
  • Building out fulfillment centers with a focus on Amazon Fresh

Links to Company Website:

Please comment below if there are data points from Amazon you’d like me to include in their next Earnings Call Summary.

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