Are the good times over for Amazon.com Inc. (AMZN)?
That’s the question many are asking after news broke on Monday that the online eCommerce giant is set to lay off hundreds of jobs at its Seattle headquarters. The actual numbers weren’t actually disclosed in the report but the rareness of the layoffs prompted many analysts to weigh in on what is going at AMZN. The consensus is that the eCommerce giant isn’t actually in trouble – something few would be surprised given the recent price rise for AMZN stock in recent months. But there is some concern that AMZN is seeing some maturity in some areas of its online eCommerce operations. It’s unclear if maturity is a euphemism for non-profitability but so far the agreed analysis is that the company is really just trimming some fat.
The news did very little to dampen investor appetite on Monday. By close of play AMZN had added $46.63 to close up 3.48% at $1,386.23. With a market cap of nearly $700B, AMZN is according to many, on its way to becoming the first $1T company. AMZN CEO, Jeff Bezos, has certainly laid out an ambitious plan to achieving that feat. Recently the company announced plan to enter the healthcare industry. The partnership between Bezos, Warren Buffet and JP Morgan CEO, Jamie Dimon, represents a concerted effort by a few titans of money to overhaul the American healthcare system. So far there is some buzz surrounding the move and judging by the lack of negative impact of recent layoff announcements, it appears AMZN is well on its way to shattering yet another set of records.
There is some heightened expectation surrounding the earnings release of Cisco Systems Inc. (CSCO). The networking giant is set to release Q4 2017 earnings on February 14 (Valentine’s Day) and many expect the company to beat expectations. So far CSCO has managed to beat expectations for several analysts. CSCO currently has guidance and estimates for second quarter 2018 revenue increase in the range of 1 – 3%. The company is also projected to deliver Non-GAAP earnings of between 58 and 60 cents a share; gross margin is projected to fall between 62.5 and 63.5% and CSCO is expected to deliver operating margin between 29.5 and 30.5%. There is real buzz about CSCO upcoming numbers, especially given the contribution its could make NASDAQ which has fallen off highs in the wake of recent sell-offs.