Suki raises $70M to build out its AI voice assistant
The company will use the funding to broaden the scope of its AI, including new administrative tasks
Read more...Oh, Lord. Amazon shares nosedived in after-hours trading following a record third quarter loss and weak fourth quarter guidance. As of this writing, shares are down nearly 11% to $279.80, which is the lowest they’ve been since July 2013. That’s a 31% drop from the stock’s record high of $407 last January.
And it all comes down to that damn Fire Phone. That would be the phone that relied entirely on the selling point that it was 3D. Would you believe that phone didn’t sell very well?
CFO Tom Szkutak said in an earnings call that the company took a $170 million charge on the device, which sold so pitifully that Amazon dropped the price to 99 cents a whole two months after its debut. Worse—Amazon is sitting on $83 million in unsold Fire Phone inventory. If sales don’t magically pickup (spoiler alert: they won’t), the company will likely have to kiss that money goodbye as well.
All of this is coming at a bad time for Amazon. Its public image has suffered in the last few months following the great Hatchette standoff, which, in conjunction with the factory protests in Germany, has led to many an “Amazon is what’s wrong with Corporate America” headlines.
But it’s not faring so well on Wall Street either, which is looking for a change of direction for the e-commerce company. Investors have been very accommodating of Amazon’s razor thin margins, but they’re starting to push for fewer and smaller company investments. A tablet, a streaming TV device, a grocery delivery service…a f*cking phone?! That’s enough, Amazon. It's not cute anymore.
All told, Amazon posted a loss of 95 cents a share—a huge jump from analysts’ expectations of a loss of 74 cents a share. And while its revenue was up 20% to $20.58 billion, it still came in below Wall Street’s estimate of $20.85 billion.
So, bad times. All around. But what’s this? Weak guidance for the fourth quarter—the holiday quarter?
Yep. Amazon topped off the third quarter shit sundae with estimates of operating income in the range of -$570 million and $430 million. Yes—a possible operating income loss of $570 million during the holiday quarter, which means Amazon is clearly anticipating low sales.
There is some good news, though. After hiking its Prime subscription fee to $99 a year from $79, many analysts feared users would drop off in droves, but that doesn’t seem to be the case. Szkutak says that Prime has had great retention and is growing quickly. Some analysts believe that the number of Prime subscribers is currently somewhere in the 40 million range.
So… a silver lining, I guess…
The company will use the funding to broaden the scope of its AI, including new administrative tasks
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