This episode breaks down Amazon's Q4 2018 earnings, offering e-commerce operators critical insights into Amazon's financial health and strategic direction. The analysis covers revenue drivers, growth sectors like AWS and advertising, and marketplace dynamics, providing context for optimizing your own e-commerce strategies in an Amazon-dominated landscape.
Key takeaways
Amazon's advertising business is a rapidly growing revenue stream, showing 95% YOY growth to $3.49B in Q4 2018, projected to reach $38B by 2023. E-commerce brands should actively explore and invest in Amazon Ads.
While overall revenue grew 20% YOY to $72.4B, Amazon's unit growth decelerated to 14% from 15% in Q3, and brick-and-mortar revenue was down 3%. This suggests a maturing core retail business and highlights the importance of diversifying sales channels beyond Amazon.
Amazon's third-party marketplace accounted for 52% of units sold in Q4 2018, with an estimated $450B GMV for the year. This continues to underscore the critical role of marketplace selling for many brands, but also signals intense competition.
AWS generated $2.2B in operating income, up 61% YOY, demonstrating Amazon's reliance on high-margin services. This reinforces the long-term trend of platform monetization beyond direct product sales, indicating where Amazon's future investments will likely occur.
EP162 - Amazon Q4 2018 Earnings Hot Take Jason & Scot will be podcasting live from the eTail West which is held Feb 19-22 in sunny Palm Springs, CA. As a special gift to listeners, you can use the code JASONSCOT for 20% off. This episode is a hot take on Amazon Q4 2018 earnings Amazon Q4 Earnings Highlights $72.4BB, which is a 20% y/y increase $19.4B in Free cash flow Amazon grew North America 18% y/y and International 15% y/y, for a blended growth rate of 17% Unit growth decelerated to 14% from 15% in Q3 Revenue from brick and mortar down 3% Amazon Web Services - Grew 45% to $7.4B for the quarter and generated $2.2b in operating income which was up 61% y/y Marketplace 52% of units, down from 53% levels in Q2 and Q3 Wingo GMV estimate -> 150B GMV for the quarter. $450B GMV for the year ($300B GMV in North America). Amazon Ad Business - grew 95% y/y to $3.49B (Estimated $10B for the year) Pivotal estimates $38B by 2023 Jason & Scot will be podcasting live from the eTail West which is held Feb 19-22 in sunny Palm Springs, CA. As a special gift to listeners, you can use the code JASONSCOT for 20% off. Don't forget to like our facebook page, and if you enjoyed this episode please write us a review on itunes. Episode 162 of the Jason & Scot show was recorded on Thursday, January 31st, 2019. Join your hosts Jason "Retailgeek" Goldberg, Chief Commerce Strategy Officer and Scot Wingo, CEO of GetSpiffy and Executive Chairman of Channel Advisor as they discuss the latest news and trends in the world of e-commerce and digital shop
What does this episode say about amazon & marketplaces?
Amazon's advertising business is a rapidly growing revenue stream, showing 95% YOY growth to $3.49B in Q4 2018, projected to reach $38B by 2023. E-commerce brands should actively explore and invest in Amazon Ads.
What does this episode say about paid acquisition?
While overall revenue grew 20% YOY to $72.4B, Amazon's unit growth decelerated to 14% from 15% in Q3, and brick-and-mortar revenue was down 3%. This suggests a maturing core retail business and highlights the importance of diversifying sales channels beyond Amazon.
What does this episode say about finance & fundraising?
Amazon's third-party marketplace accounted for 52% of units sold in Q4 2018, with an estimated $450B GMV for the year. This continues to underscore the critical role of marketplace selling for many brands, but also signals intense competition.
What does this episode say about amazon & marketplaces?
AWS generated $2.2B in operating income, up 61% YOY, demonstrating Amazon's reliance on high-margin services. This reinforces the long-term trend of platform monetization beyond direct product sales, indicating where Amazon's future investments will likely occur.
