Tag: Etailing

Earnings have beaten Wall Street estimates by more than usual in 2nd quarter, but 3rd quarter isn’t looking great

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Online retail giant Amazon.com Inc.’s
AMZN,
+8.27%
second-quarter results and third-quarter forecast sales last week were a bet that more consumers would start buying more things, but Wall Street’s expectations for the third quarter overall have only grown dimmer.

With most of the 500 companies that make up the S&P 500 Index
SPX
already through the second-quarter earnings reporting season, slightly more than normal have reported per-share profit that beat Wall Street’s estimates, according to FactSet.

For the third quarter though, analysts now expect a mere 0.2% increase in per-share profit growth overall, according to a FactSet report on Friday, or slightly lower than the 0.4% growth that was expected for the third quarter on June 30,

And with some two months still left in the third quarter, and with that forecast likely to come down as the period progresses, Wall Street’s profit expectations are getting ever closer to turning negative.

Wall Street analysts overall still expect a bigger rebound for the fourth quarter, the FactSet report said. And they expect 2023 overall to eke out a per-share profit gain of 0.8%.

Worries of a U.S. recession emerging at some point during the back half of this year have started to fade at least a little after many economists fixated on the possibility earlier this year when the Federal Reserve was raising interest rates to combat a jump in inflation in 2022 . Some analysts now say savings fatigue could prompt more shoppers to splurge this year, after relentlessly tightening their budgets due to rising prices.

Federal Reserve Chair Jerome Powell last month said policymakers at the central bank had also shucked off their worries of a downturn.

See: Fed no longer foresees a U.S. recession — and other things we learned from Powell’s press conference

“The staff now has a noticeable slowdown in growth starting later this year in the forecast. But given the resilience of the economy recently, they are no longer forecasting a recession,” he said last month.

Not everyone is convinced that a downturn has vanished from the horizon though. Sheraz Mian, director of research at Zacks, told MarketWatch last month that more bearish analysts had kept pushing out their recession forecasts, after being defied by the actual, and more positive, economic data. Some economists continue to push out those forecasts.

“We still expect a recession, but now we are looking for it to begin in Q1 2024 rather than Q3 2023,” Thomas Simons, U.S. economist at Jefferies, said in a research note on Friday.

He said that interest rate hikes from the Federal Reserve were only just starting to affect customer behavior. Households were trying to rebuild their savings, after spending through whatever they had built up during the pandemic. Student-loan payments were returning, he said, and corporate margins were thinning.

“Corporate profit margins are narrowing, and businesses will look to cut costs through layoffs,” he said.

This week in earnings

Among S&P 500 index companies, 34 report results during the week ahead, including one from the Dow Jones Industrial Average, according to FactSet.

Results from Walt Disney Co.
DIS,
+0.95%
will likely gobble up more media attention, but earnings from Paramount Global Inc
PARA,
+3.58%
— which oversees CBS, Showtime, Comedy Central and other channels — will offer more detail about how studios are positioning themselves with Hollywood actors on strike. Lions Gate Entertainment Corp.
LGF.A,
-2.44%
also reports.

Results from Tyson Foods Inc.
TSN,
+0.34%
will give investors and customers a brief look at the state of the grocery aisle where higher food prices over the past year have strained spending on other things. Beyond Meat Inc.
BYND,
-1.38%,
which also reports during the week, will be hoping new product launches of plant-based meat-like alternatives can overtake analyst skepticism, amid competition with fake meat and real meat alike.

Elsewhere, ride-hailing platform Lyft Inc.
LYFT,
-5.73%,
online dating service Bumble Inc.
BMBL,
-3.86%
and video-game maker Take-Two Interactive Software Inc.
TTWO,
-2.45%
also report during the week. And Canadian pot producer Canopy Growth Corp.
CGC,
-3.47%
will get another chance to pick up the pieces, after over-expanding and now trying to hold onto its cash.

The call to put on your calendar

Disney drama: One way or another, people on both coasts are mad at Disney
DIS,
+0.95%
Chief Executive Bob Iger right now, as his company prepares to report quarterly results on Wednesday. Shares of Disney are down slightly this year. The company is currently fighting with Florida Gov. Ron DeSantis, who is trying to stamp out Disney World’s self-governing privileges after the company criticized the state’s restrictions on classroom discussion of gender identity. When Iger accused striking actors and writers in Hollywood of not being “realistic,” the actors and writers shot back, noting his hefty executive compensation plan.

While the friction in Florida hasn’t hurt Disney’s parks attendance, the Hollywood shutdown has threatened Disney’s massive film and TV show operations, as Disney+ subscribers fall and investors more aggressively seek profits from studios’ streaming operations. Elsewhere, Rich Greenfield, an analyst at LightShed Partners, said “Pixar and Disney Animation have not had a breakout hit that impacted children’s play patterns and both Marvel and Lucasfilm feel increasingly tired from overuse.”

The sense is growing that more time is needed for Iger to fix Disney’s problems. On Wednesday, analysts may get a deeper sense of how much more, with the chance of more drama between Disney and its home state and the writers and actors the company depends on.

The number to watch

UPS and the Teamsters deal: United Parcel Service Inc. reports quarterly results on Tuesday, as rank-and-file Teamsters vote on a tentative labor agreement struck with the package deliverer in an effort to avert a strike. The deal, if approved, would raise worker pay and give the economy and businesses a breather, after threats of strikes or work stoppages at the nation’s ports and railways were averted over the past year.

Local Teamsters unions have voted overwhelmingly to at least endorse the agreement, between UPS
UPS,
-0.31%
and the Teamsters union, which represents 340,000 UPS workers, but not everyone was happy with the deal. Some part-timers felt the Teamsters could have used their leverage to wrest more from UPS, following a profit windfall at the company. And investors have held out for more detail from UPS executives themselves on what the deal might mean for the bottom line and for shipping prices.

Analysts will be dissecting the impact of the agreement as shipping demand lags, trucking company Yellow Corp.
YELL,
-0.83%
reportedly shuts down and FedEx Corp.
FDX,
-0.20%
tries to slash costs.

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August 6, 2023
The ‘stabilization’ of AWS may have been the most significant number for Amazon’s earnings

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For weeks, Wall Street had been closely eyeing the performance of Amazon Web Services: Would it rise more than 10% in year-over-year sales?

It did, and then some, on Thursday when Amazon.com Inc.
AMZN,
+0.55%
announced its quarterly results, boosting company shares more than 9% in after-hours trading.

Read more: Amazon beats expectations on domestic e-commerce sales, AWS; stock jumps

Sales for Amazon’s market-leading AWS jumped 12%, to $22.1 billion, offering proof of its “stabilization” after several rough quarters, Jefferies analyst Brent Thill told CNBC late Thursday. More important, it signals healthier days — for now — in the cloud market amid a stampede for generative-AI services and concerns about Amazon’s place in it.

“I am bullish on AWS’s growth,” Amazon Chief Executive Andy Jassy said in a conference call with analysts late Thursday, in which he predicted AWS would become a $100 billion business within several years.

Last week, Microsoft Corp.
MSFT,
-0.26%
said it expected revenue growth from Azure and other cloud services to continue cooling in the current quarter. Meanwhile, Alphabet Inc.’s
GOOGL,
+0.05%

GOOG,
+0.10%
Google Cloud revenue grew 28%, topping Wall Street estimates.

Maribel Lopez, founder and principal analyst at Lopez Research, called Amazon’s cloud revenue “surprising” and resilient despite cost optimization among enterprise buyers. “Upcoming AI workloads should keep [Amazon] in a similar top-line growth trajectory, but the challenge will be keeping the cost to serve down,” she said in an email. “The new chipsets will assist with cost containment. Overall, the AI business will provide a bright light in the cloud market.”

Although Thill and other analysts openly wonder how AWS will adapt in the age of AI, the company’s second-quarter sales figures heartened Amazon’s top boss, who knows a thing or two about the cloud-computing industry.

“Our AWS growth stabilized as customers started shifting from cost optimization to new workload deployment, and AWS has continued to add to its meaningful leadership position in the cloud with a slew of generative AI releases that make it much easier and more cost-effective for companies to train and run models,” the embattled Jassy, who previously ran AWS, said in a statement Thursday, announcing the results.

Underscoring the importance of AWS, it was mentioned 49 times in Amazon’s second-quarter earnings release, mostly cited in customer use cases.

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August 3, 2023
Amazon and Apple to headline Q2 earnings this week

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When Amazon.com Inc. and Apple Inc. report quarterly results on Thursday, we’ll get a look at two big companies, with big expectations, trying to do smaller things — or at least less exciting things, or things that might be more inconveniencing to customers — to stay bigger.

For Apple
AAPL,
+1.35%,
D.A. Davidson analyst Tom Forte said, the focus will be on the iPhone, as always, as well as demand abroad and a new VR headset, as its stock hovers near record highs and its market value holds above $3 trillion. And he said that Amazon
AMZN,
+3.09%,
meanwhile, could face questions about the impact of cost cuts on e-commerce growth, and what AI could do to boost slower growth in its cloud business.

The results from those companies, which are big enough to make or break a single quarter’s worth for the S&P 500 Index
SPX,
+0.99%,
will follow those from the other tech giants like Microsoft Corp.
MSFT,
+2.31%
and Facebook parent Meta Platforms Inc.
META,
+4.42%.
And they’ll arrive as Wall Street starts to get a tad more realistic about AI: Microsoft shares fell after management said the expansion of its AI capabilities would be “gradual” — and gradually more expensive.

D.A. Davidson analyst Tom Forte, in a research note this month, said Amazon, like other big tech companies, was taking more steps to control its costs. That might help margins, he said. But he said he’d be watching for any impact to e-commerce sales growth, following thousands of layoffs and pulling back on its expansion of Amazon Fresh.

Amazon began tacking on servicing fees onto some Amazon Fresh delivery orders this year. And Forte noted what he said were other tweaks to service: Charging for a home pickup of a defective smoke alarm that used to be free, and incentives to wait longer during Prime Day.

“In our view, Amazon is playing a ‘game of chicken’ and banking on other e-commerce companies not to offer a superior service, instead of its historical approach of working backwards with a customer-obsessed approach,” D.A. Davidson analyst Tom Forte said in a research note.

He added later: “We believe there is something to be said about the experience of having an Amazon-branded delivery vehicle show up at your house EVERY day. Having one show up once a week or twice is not the same.”

At Apple, Forte said in a separate note, the iPhone, whose sales were still solid, had turned into more of a consumer staple than a discretionary buy. He also said he’d be looking for more detail about the upcoming iPhone 15 — likely to be modestly fancier than previous iPhones — the recovery in China and growth in India. Apple last month also unveiled its Vision Pro VR headset — for $3,499. Forte said he had his doubts.

“We believe Apple will have to overcome a number of structural challenges to achieve mass adoption for its AR/VR headset,” he said.

This week in earnings

Apple and Amazon will report as more companies than normal report quarterly profit ahead of estimates, according to a FactSet report on Friday. For the week ahead, 170 S&P 500 companies report results, with four from the Dow, the repot said.

Results from Uber Technologies Inc.
UBER,
+3.28%
and DoorDash Inc.
DASH,
+4.20%
will offer an update on the gig economy and how far app-based deliveries can go, while results from Kraft Heinz Inc.
KHC,
-0.11%
will offer an update on food prices and how much they might ease from the highs seen in recent months.

With the “Barbie” movie lifting rival Mattel Inc.
MAT,
-2.40%,
results from Hasbro Inc
HAS,
-0.29%
during the week will offer a glance at the rest of the toy industry, where demand hasn’t exactly been great, and what entertainment options Hasbro has up its sleeve to keep apace with its archrival. Drug maker Pfizer Inc.
PFE,
-0.36%
reports, as does video-game maker Electronic Arts Inc.
EA,
+0.25%.
Starbucks Corp.
SBUX,
+0.47%
reports as well.

The call to put on your calendar

“Barbie,” the Hollywood strike and Warner Bros. Discovery: Mattel has said it wants to turn “Barbie” into a content franchise. Now we’ll hear what Warner Bros. Discovery Inc.
WBD,
+4.07%,
the media conglomerate that produced the film, thinks about the film’s results and its prospects, as studios increasingly pump out sequels or offshoots of well-known, established character universes like “Star Wars,” Marvel and DC. The company — which reports oversees Warner Bros. CNN, TNT and the streaming service Max — reports quarterly results on Thursday. But even as “Barbie” and “Oppenheimer” carry the parts of the entertainment industry that are still functioning through the Hollywood strike, Wall Street will likely be focused on contingency plans, and any sense of whether more viewers are turning to streaming with productions on pause.

The number to watch

Payments and crypto volumes: Results this week from trading app Robinhood Markets Inc.
HOOD,
+4.09%
and crypto exchange Coinbase Global Inc.
COIN,
+2.23%,
along with PayPal Holdings Inc.
PYPL,
+2.71%
and Block
SQ,
+3.42%,
will land at the intersection of rebounding markets and job-market concerns.

UBS analysts predicted solid growth and cost control for Block, and “steady” e-commerce trends for PayPal. But BofA analysts said PayPal’s search for a new chief executive, following the announcement of Dan Schulman’s retirement at the end of the year, would become more important, adding that “we think investors should rightfully expect the CEO search to conclude in the near-term.” While Bitcoin’s rebound helped Coinbase, the company and others in the industry face the prospect of tougher regulations. Robinhood and PayPal report on Wednesday. Coinbase and Block report on Thursday.

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July 30, 2023
China-Founded Rivals Ramp Up War for American Shoppers

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China-Founded Rivals Ramp Up War for American Shoppers

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July 29, 2023
The Next Challengers Joining Nvidia in the AI Chip Revolution

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What to Read Next

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July 10, 2023
Why Amazon clicks with shoppers — on Prime Day or any day

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Some time ago, I was standing in the vitamin aisle of my local pharmacy, struggling to locate a specific bottle of pills that my doctor had recommended. It was seemingly nowhere to be found. And based on my experience at this particular store, I knew that even if I was able to track down an employee for help, I wasn’t likely to receive much in the way of assistance.

Then, a solution to my dilemma suddenly dawned on me: Amazon
AMZN,
-2.17%
! I looked up said bottle, found it within almost no time and ordered it. By the next day, it had arrived. And it probably cost me a couple of dollars less than what I would have spent at the pharmacy — if I had ever located it there.

Of course, you don’t need to be in search of a hard-to-find item to appreciate the wonders of the online retail giant that Jeff Bezos founded from his garage in 1994. Millions of us are likely to be on the site this week for Amazon’s annual Prime Day event running July 11 and 12 this year, which is a sales extravaganza that one bargain-mad colleague likened to “basically my Super Bowl.” To take advantage of the deals, you’ll naturally have to be an Amazon Prime member, which carries an annual fee of $139. But it’s not like that’s a small number of folks: Amazon says there are now more than 200 million such members worldwide.

Read more: 5 hacks to get the best deals on Amazon Prime Day — and other summer sales

And: What not to buy on Amazon Prime Day — and why discounts may be even bigger this year

I’ve been one of those Prime people for years — if nothing else, for the free two-day shipping it offers. But even before I signed on for Prime, I ordered plenty from Amazon. My purchases over the past decade have ranged from a super-hot horseradish to a pair of armrest slipcovers to a folding exercise bike. Actually, I ordered the three items I just mentioned during the first couple of months of the pandemic, when Amazon became a kind of lifeline given the health risks of shopping in person. But if I go back in time, I find countless purchases for books (Amazon’s original specialty), clothes and margarita mix (there’s a brand I like that I often can’t find at the supermarket).

“At this point, Amazon isn’t just a company. It’s an institution woven into the fabric of our lives.”

And yet, I know there are plenty of people, including some of my friends and relatives, who boycott Amazon. They point to the oft-cited criticisms of the company, such as the treatment of its workers (in 2019, the company’s employees were injured on the job far more than the national average in the warehousing and storage sector) to the broader notion that online retailers hurt the brick-and-mortar stores that have been a traditional bedrock of our communities.

Criticizing Amazon has become almost a sport unto itself. There are books devoted to the subject, such as Alex MacGillis’ “Fulfillment: Winning and Losing in One-Click America” (ironically, I purchased my copy of it on Amazon). Heck, there’s even a whole Wikipedia page detailing the criticisms.

I get the issues that many people have. And it’s not like Amazon doesn’t recognize them, either: The company has acknowledged the injury situation, for example, but has also pledged to cut incidents in half by 2025, according to The Wall Street Journal.

When I reached out to Amazon for this column and cited the various criticisms made of the company, Amazon responded with a statement that, among other things, said it works “hard to be a good neighbor…with communities across the country” and that it creates “good jobs with competitive pay and benefits, including health care from the first day, up to 20 weeks paid parental leave, and full college tuition.” Amazon also cited some of its philanthropic initiatives, including its Amazon Housing Equity Fund, a $2 billion program to build or preserve affordable homes.

All of this is what you expect from a giant corporation trying to defend itself. I’m not going to get into the weeds about the particular criticisms and whether Amazon makes a successful case for itself or not. But I will say that people vote with their wallets. And they’re reelecting Amazon on a daily, if not hourly, basis with all their purchases.

“People vote with their wallets. And they’re reelecting Amazon on a daily, if not hourly, basis with all their purchases.”

Ultimately, Amazon is about convenience combined with competitive pricing — a formula that’s hard to beat. It launched the era of online retailing, and it has mastered the art of it to this day. When I hear people bemoan the fates of all those brick-and-mortar stores, I admit to thinking to myself, “OK, but do you still want your mail delivered by the Pony Express?” Or, “Do you still want to do your shopping at ye olde general store?”

The point is that we evolve as a society and new forms of commerce and communication take over. Yes, there are prices to be paid for that. I admit to missing some of the brick-and-mortar stores and chains that were part of my youth — I’m 59 years old, and remember spending practically entire days in neighborhood bookshops long gone. For that matter, I don’t condone bad behavior by large multinational companies; though, like I said, I’ll let others debate some of the specifics regarding Amazon.

But let’s face it: At this point, Amazon isn’t just a company. It’s an institution woven into the fabric of our lives — and for good reason, I’d argue. I don’t care about shopping on Prime Day, though I know there are a few deals to be had. Mostly, I just increasingly rely on Amazon to make my life easier by selling me any number of things I need on a daily basis, including household staples (yes, you can buy toilet paper on Amazon — the company even sells its own brand). And that’s to say nothing of the services the company offers, including its Prime Video streaming (you can thank Amazon for the truly marvelous — and Emmy-winning — “The Marvelous Mrs. Maisel” series, for example).

Could someone come along and invent a better version of Amazon, one that might not be as widely criticized? Perhaps, but that’s probably years, if not centuries, down the road. In the meanwhile, we have the Amazon that we have. Now, let me see if I’m out of toilet paper…

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July 10, 2023
‘This is a game changer’: Ahead of Amazon Prime Day, a new law makes it harder for online sellers to hawk fake or stolen products

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Shopping online has just gotten safer.

The INFORM Consumers Act, which went into effect Tuesday, aims to limit the sales of stolen and counterfeit products on e-commerce platforms.

The measure, which requires e-commerce sites to verify and disclose information about their high-volume third-party sellers, was passed into law following a lobbying campaign to address counterfeit products after being left out of the bipartisan Chips and Science Act last year.

All online marketplaces, including eBay, Etsy, Poshmark and Amazon’s third-party sales platform, will now be required to collect information from high-volume sellers, defined as those selling 200 items or more totaling at least $5,000 over the previous 12 months. These third-party sellers must submit information such as a government-issued ID, a bank-account number, a working email address and phone number, and a taxpayer identification number.

Customers will also be able to find the verified contact information for bigger third-party sellers — those with sales of over $20,000 a year — and to get in touch with them outside of the e-commerce platform. In the past, consumers often had to engage within the platform operator in order to communicate with a seller.

Those bigger sellers will also have their full names and physical addresses listed on their product pages in addition to their contact information, according to the Federal Trade Commission’s business guide.

“This is a game changer,” said Teresa Murray, director of the consumer watchdog office at U.S. PIRG, a nonprofit that lobbies on behalf of the public interest. “For bad guys, stealing items has generally been the difficult part. Selling things online once you’ve stolen them is easy. We hope that with the INFORM Act, it’s not nearly as easy in the future.”

“‘The only people opposing this may be thieves.’”

— Teresa Murray, U.S. PIRG

The act goes into effect just weeks before Amazon Prime Day, when the world’s biggest e-commerce site rolls out discounts for Prime members. This year, Prime Day will be held over two days, on July 11 and 12.

Picks: Amazon Prime Day is July 11-12. You’ll need the $139-a-year Prime membership to access the deals, but is it actually worth it?

Also see: Amazon sued by FTC, which alleges people were ‘tricked and trapped’ into Prime subscriptions

Several e-commerce platforms, including Amazon and eBay, supported the INFORM Consumers Act. TechNet, a national network of technology CEOs and senior executives representing what it calls the innovation economy, wrote to leaders in Congress last December, saying the law would improve consumer safety and increase transparency.

In a statement provided to MarketWatch, eBay
EBAY,
+2.32%
said it “fully supports transparency and is committed to a safe selling and buying experience for our customers. We were proud to support” the law “to protect consumers from bad actors who seek to misuse online marketplaces, while also ensuring important protections for sellers. We are fully prepared to comply with the new law.”

Etsy
ETSY,
+3.45%
said it “has long been supportive of the INFORM Act passing into law, as a balanced and thoughtful approach to make the ecommerce landscape safer for both consumers and sellers.” In a statement provided to MarketWatch, the company said, “We are taking appropriate steps to comply with the INFORM Act requirements.”

Amazon
AMZN,
+1.45%
and Poshmark, owned by South Korea–based Naver Corp.
035420,
-0.59%,
did not immediately respond to MarketWatch requests for comment.

Some analysts, however, said the new law lacks stronger protections that were included the SHOP SAFE Act, an earlier bill that did not get passed by Congress. The INFORM Act, they noted, does not hold online platforms liable when a third party sells harmful counterfeit products or when the platform has not followed certain best practices.

“Notably, the legislation is supported by Amazon and other marketplaces as it’s seen as a watered-down bill that would head off more stringent legislation like the SHOP SAFE Act,” Ben Koltun, director of research at Beacon Policy Advisors, wrote in a note last year.

So how can consumers spot counterfeit or stolen items? A guide from PIRG has tips, such as keeping an eye out for products with suspiciously low prices or featuring misspellings or mislabeling or low-quality, photoshopped photos in their listings.

PIRG also cautions consumers about purchasing medications online. Always check the legitimacy of online pharmacies, it says.

“Many online marketplaces haven’t been doing enough to protect consumers from sellers who appear to be peddling stolen or counterfeit goods,” Murray said. “The only people opposing this [new law] may be thieves.”

Victor Reklaitis contributed.

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June 27, 2023
How hard has it been to cancel Amazon Prime? Start by navigating 4 pages, 6 clicks and 15 options.

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Signing up for Amazon Prime is as easy as 1-2-3. Canceling it, not so much.

For years, up until this past April, the online retail giant made customers trying to quit its signature service navigate an odyssey through a labyrinthine system called the “Iliad Flow” named after the epically long and complex masterwork by the Greek poet Homer.

According to a civil lawsuit filed Wednesday by the Federal Trade Commission, Amazon customers were required to make their way through a four-page, six-click, 15-option process to stop paying for the service. One wrong click, and they were sent back to the beginning, the lawsuit said.

The FTC noted that Amazon
AMZN,
+3.69%
maintained the multistep process even though new subscribers in the U.S. to $14.99-a-month or $139-a-year Prime accounts needed only one or two clicks. And even though subscribers could sign up on a multitude of devices, they could only cancel using their desktop computer or mobile phone or by calling customer service.

The FTC suit also accused Amazon of manipulating millions of customers into inadvertently signing up for Prime and then hitting them with automatic renewals without warning.

Amazon has dismissed the charges as misguided, adding that the lawsuit is legally and factually inaccurate. It has vowed to fight the FTC.

The FTC said in court papers that Amazon created the complex “Iliad Flow” exit strategy in 2016 and kept it in place until April of this year, when it caught wind that the agency was preparing to file a lawsuit about the practice.

During that time frame, Amazon quadrupled the number of global Prime subscribers from around 50 million to more than 200 million. The program brings around $25 billion into Amazon’s coffers every year.

The suit described an allegedly maddening process for a customer to actually cancel a subscription.

To start, a subscriber first had to find the “Iliad Flow,” which was not made easy, the FTC suit said. A customer had to select the “accounts and list” dropdown menu, navigate to the third column and then select the eleventh option there: Prime Membership.

That would bring the customer to the Prime Central page. There, one would have to click the “manage membership” button to trigger options that finally included an “end membership” button. But that was only the beginning.

Only after clicking “end membership” would the customer enter the “Iliad Flow” process. From there, a customer would need to navigate three more pages, each with a multitude of options, to finally complete canceling the subscription.

This is one of several web pages a Prime customer would need to navigate in order to cancel the service, the FTC said.

Federal Trade Commission

On the first page, customers were forced to “take a look back at [their] journey with Prime” — a kind of greatest-hits reel of Prime services used over the years. The page was also loaded with marketing material for a multitude of Prime services, with links reading: “Start shopping today’s deals!” and “You can start watching videos by clicking here!” or “Start listening now!”

One wrong click would knock the subscriber out of the “Iliad Flow.”

If the subscriber managed to navigate to the bottom of the page, he or she would finally find a “continue to cancel” button. That would take them to Page 2.

According to the FTC, that page would present the customer with a number of discount options, such as switching from monthly to annual payments, or taking advantage of student discounts or discounts for people on government assistance. The page also included warning icons and links stating: “Items tied to your Prime membership will be affected if you cancel your membership,” and “By canceling, you will no longer be eligible for your unclaimed Prime exclusive offers.”

Clicking on any of those would take the subscriber out of the “Iliad Flow.”

At the bottom of that page was another “continue to cancel” button, which would take the user to Page 3.

If you managed to get to this page, you were only six options away from actually being able to quit Amazon’s Prime service, the FTC suit said.

Federal Trade Commission

On this final page, a customer was presented with five options, only the last of which — “end now” — would actually allow the subscription to be canceled. The other options included pausing the subscription or canceling its auto-renewal function. Pressing any of the four other choices would bring the user out of the “Iliad Flow.” They would have to start over if they wanted to continue.

Only after successfully navigating this maze of web pages would the customer be allowed to actually cancel the service.

The suit said this process caused cancellations to drop significantly.

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June 22, 2023
Alibaba, Dice, Arcellx, Avis, PayPal, and More Stock Market Movers
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https://www.barrons.com/articles/stock-market-movers-fb3791aa
Updated June 20, 2023 9:56 am ET / Original June 20, 2023 4:49 am ET

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June 20, 2023
Amazon Was the Rare AI and Cloud Play Left Out of the Nvidia Bump. Here’s Why.
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https://www.barrons.com/articles/amazon-misses-rally-8a6e2511
Updated May 25, 2023 6:10 pm ET / Original May 25, 2023 5:55 pm ET

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May 25, 2023
Nvidia barrels toward rare $1 trillion valuation after putting a dollar figure on AI boost

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Nvidia Corp. headed toward market-capitalization gains of nearly $200 billion in after-hours trading Wednesday, which could put the chip maker within sight of becoming only the seventh U.S. company to top a valuation of $1 trillion.

Nvidia shares
NVDA,
-0.49%
jumped 25% in the extended session Wednesday, after executives predicted that revenue would exceed the company’s record by more than 30% in the current quarter. The audacious forecast arrived as tech companies look to jump on advances in artificial intelligence that are largely powered by Nvidia’s computing gear.

Nvidia ended Wednesday’s session with a market cap — the total value of all shares in existence — of roughly $754.3 billion, according to FactSet. A 25% increase would add nearly $189 billion to that total, putting the company within striking distance of $1 trillion. Only six U.S. companies have ever attained a $1 trillion market cap: Apple Inc.
AAPL,
+0.16%
and Microsoft Corp.
MSFT,
-0.45%
are currently worth more than $2 trillion apiece; Google parent Alphabet Inc.
GOOGL,
-1.35%
and Amazon.com Inc.
AMZN,
+1.53%
have valuation of more than $1 trillion; and Facebook parent Meta Platforms Inc.
META,
+1.00%
and Tesla Inc.
TSLA,
-1.54%
have both touched the $1 trillion plateau previously.

For more: From U.S. Steel’s $1 billion market cap to Apple’s $1 trillion — a brief history of valuation milestones

Nvidia’s market cap was ahead of both Meta and Tesla as of Wednesday’s close, with both worth less than $650 billion, showing the potential fleeting nature of such a valuation. Nvidia’s record market cap is $834.4 billion, established on Nov. 29. 2021, according to Dow Jones Market Data.

If Nvidia’s gains hold through Thursday’s trading session, the company could challenge for the largest one-day market-cap gain in history. The biggest currently on record was Amazon’s $191.2 billion increase on Feb. 4, 2022, according to Dow Jones Market Data, followed closely by a $190.9 billion gain by Apple on Nov. 10, 2022. Nvidia also stands to gain more than rival Advanced Micro Devices Inc.
AMD,
+0.14%
is worth in total — AMD ended Wednesday’s session with a market cap of $174.4 billion.

Nvidia is closing in on the rare $1 trillion plateau because of huge gains in its stock this year, as hopes and hype about generative AI have flooded the tech sector. After OpenAI debuted its ChatGPT AI offering, and investor Microsoft quickly integrated the chatbot into many of its services, expectations for the technology have exploded.

Despite the hype, most companies have avoided providing hard figures for revenue gains expected from AI. Nvidia’s fiscal second-quarter forecast — which calls for roughly $11 billion in sales, nearly 33% higher than Nvidia’s previous quarterly record of $8.28 billion — could be seen as the first sign of a wave of fresh spending coursing through the tech sector.

Other companies have indicated that they will be forced to spend to develop their technology before reaping large financial rewards from it. Microsoft, for example, disclosed to investors last month that capital expenditures are increasing as it builds AI capabilities into its Azure cloud-computing platform — spending that is largely going toward Nvidia.

Full earnings coverage: Nvidia stock soars toward all-time high as AI push leads executives to predict record revenue

That is a rather typical path for large jumps in tech spending: Companies that make the necessary hardware see gains before the companies that use that gear can develop offerings that take advantage of it. Other gear makers joined Nvidia in the sharp move higher in after-hours trading Wednesday, including AMD, which gained more than 10%; chip maker Marvell Technology Inc.
MRVL,
-1.31%,
which increased more than 5%; and networking specialist Arista Networks Inc.
ANET,
+0.53%,
which added about 5%.

Alphabet and Microsoft stocks both increased around 2% in after-hours trading, and software companies that have made AI a core part of their offerings also saw gains. Palantir Technologies Inc.
PLTR,
-3.24%
and C3.ai Inc.
AI,
+2.54%
shares both increased more than 8%, for example.

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May 24, 2023
Fanatics to buy PointsBet’s U.S. sports-betting business for $150 million

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Fanatics Inc. will buy the U.S. operations of Australia’s PointsBet for about $150 million, in the company’s largest foray yet into sports betting.

PointsBet
PBH,
-18.70%
announced the deal Sunday night, specifying that the acquisition only applies to PointsBet’s U.S. assets, not its businesses in Australia and Canada. CNBC first reported the deal. Fanatics did not immediately reply to MarketWatch’s request for comment Sunday night.

PointsBet is an online sportsbook that launched in the U.S. in 2019, and operates in 15 states, including New Jersey, Iowa, Illinois and Colorado.

“Despite the strategic success building a valuable asset in the U.S., the costs of operating in a state-by-state environment, together with the requirement to build significant scale to compete against well capitalized operators, led us to explore a number of options,” PointsBet Chief Executive Sam Swanell said in a statement. “The sale of the U.S. Business to Fanatics Betting and Gaming delivers the most attractive risk-adjusted value outcome for shareholders compared to the risks and benefits of other options including the status quo.”

PointsBet shareholders are expected to vote on the sale at their annual meeting in late June.

The deal should increase pressure on U.S. sports-gambling companies such as DraftKings Inc.
DKNG,
-1.96%
and FanDuel. In late April, Fanatics launched sportsbook wagering for its customers in Ohio and Tennessee, and the Wall Street Journal reported at the time that the company pans to invest about $1 billion in its new sports-betting division.

In an interview, Fanatics CEO Michael Rubin told the Journal he wants Fanatics to be the world’s top sports-betting company within the next 10 years, and expects its betting operations to be profitable by 2025 or 2026.

In December, Florida-based Fanatics — which got its start in sports apparel and collectibles — closed a $700 million funding round, valuing it at about $31 billion, the Wall Street Journal reported. The privately held company is expected to eventually launch an IPO.

Last year, Fanatics acquired trading-card company Topps.

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May 14, 2023
Walmart, Alibaba, Target, and More Stocks to Watch This Week

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Walmart, Alibaba, Target, and More Stocks to Watch This Week

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May 14, 2023
Amazon stock turns around as CFO admits AWS growth rates are declining further

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Amazon.com Inc. shares zoomed higher in extended trading Thursday after the company posted its biggest quarterly profit since 2021, but shares turned around after the company’s chief financial officer said in a conference call that cloud revenue is decelerating in the current quarter.

Amazon AMZN reported that first-quarter revenue grew to $127.4 billion from $116.44 billion in the same quarter last year. Profit reached $3.17 billion, or 31 cents a share, improving from a loss of 38 cents a share a year ago, which was Amazon’s…

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April 27, 2023
Amazon stock gives up gains as CFO admits AWS growth rates are declining further

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Amazon.com Inc. shares zoomed higher in extended trading Thursday after the company posted its biggest quarterly profit since 2021, but shares turned around after the company’s chief financial officer said in a conference call that cloud revenue is decelerating in the current quarter.

Amazon AMZN shares jumped more than 10% in after-hours trading immediately following the release of first-quarter results, but those gains disappeared after Chief Financial Officer Brian Olsavsky said in a conference call with analysts that…

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April 27, 2023
China’s GDP Beat Expectations. Why Alibaba and JD.com Are Falling.

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Alibaba

JD.com

and other Chinese stocks fell Tuesday despite the country’s economy rebounding at a faster-than-expected pace in the first quarter.

China’s gross domestic product (GDP) rose 4.5% in the first three months of the year, convincingly beating the FactSet economists’ consensus for 3.4% growth.

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April 18, 2023
Alibaba’s Shakeup Is Unrivaled. What It Means for the Stock.

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Alibaba

stock was on track for its best day in months after the Chinese technology giant announced that it would split itself into six units, opening the door for its subsidiary businesses to go public.

Akin to Alibaba (ticker: BABA) shifting from conglomerate to holding company, the move is designed to unlock shareholder value and foster market competitiveness, said the group, which is one of China’s largest and most important companies. It’s a nod both to investors who have weathered years of losses for the stock—caused largely by regulatory pressures—as well as regulators who have hammered Alibaba and the rest of the Chinese tech sector over competition concerns since late 2020.

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March 28, 2023
Amazon’s stock dips 1% as another 9,000 layoffs announced

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Amazon.com Inc. is eliminating another 9,000 jobs, the company announced Monday morning.

In a memo to staff, Amazon
AMZN,
-1.25%
Chief Executive Andy Jassy said the cuts would take place over the next few weeks and primarily affect Amazon Web Services, People Experience and Technology Solutions, advertising and Twitch. [Twitch CEO Dan Clancy broke the news of 400 layoffs to employees in a blog post later Monday.]

“This was a difficult decision, but one that we think is best for the company long term,” Jassy wrote.

“For several years leading up to this one, most of our businesses added a significant amount of headcount,” Jassy added. “This made sense given what was happening in our businesses and the economy as a whole. However, given the uncertain economy in which we reside, and the uncertainty that exists in the near future, we have chosen to be more streamlined in our costs and headcount.”

The news sent the retailer’s stock down 1% in trading Monday.

The latest layoffs, amid a challenging macroeconomic climate that has claimed tens of thousands of jobs in the tech industry, follow an earlier round at Amazon, announced in November, that affected more than 18,000 employees. Additionally, Amazon has paused construction of its second headquarters in Virginia.

At the same time, there are rumblings out of the Beltway that the Biden administration is preparing legal actions against Amazon stemming from investigations into its business practices, according to a report in Politico.

Amazon is the second Big Tech company this month to announce additional job cuts. Last week, Mark Zuckerberg, CEO of Facebook parent Meta Platforms Inc.
META,
+1.12%,
wrote in a blog post the social-networking company would slash 10,000 more employees as it focuses on a “year of efficiency.” The move drove Meta shares up 7% and helped the company top $500 billion in market value for the first time since June.

In November, the company said it would cut 11,000 employees, or about 13% of its workforce, in the first layoffs in the company’s 18-year history.

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March 20, 2023
Rivian Stock Falls on Amazon News. It Might Be an Overreaction.

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Shares of

Rivian Automotive

fell after a report said the electric truck start-up is in talks to end an exclusivity pact with Amazon.com. That might have been an overreaction, judging by Amazon’s response to the news.

The Wall Street Journal reported Monday that Rivian (ticker: RIVN) is seeking to remove an exclusivity term in its agreement with Amazon (AMZN) after the e-commerce retailer ordered about 10,000 electric delivery vans for this year, which was on the lower end of Amazon’s range.

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March 13, 2023
Rivian’s stock falls more than 3% as EV maker and Amazon consider changes to electric-van deal

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Rivian Automotive Inc.’s stock fell more than 3% Monday after news that the electric-vehicle maker and Amazon.com Inc. are discussing possible changes to their deal for electric delivery vans.

Citing people familiar with the matter, the Wall Street Journal reported Monday that the companies are in talks to end the exclusivity part of their electric-van deal. The talks started after Amazon’s order for the year was at the low end of the previous range, the report said.

A…

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March 13, 2023