The e-retail giant made a lot of great-sounding entertainment deals over the last few months including agreements to stream shows from Viacom, NBCUniversal, and PBS — and to greenlight original shows that it will begin to offer later this year. But those deals contributed to a 46% increase in technology and content costs. And that’s one reason Q2 financial results failed to impress investors, sending Amazon shares down 2.2% after hours. The company had a net loss of $7M, down from a $7M profit in the period last year, on revenues of $15.7B, +22%. Revenues came in just a little lower than analysts expected. But the 2 cent-per-share loss contrasted with predictions for a 5 cent gain. To make matters worse, Amazon said it expects an operating loss of as much as $440M in Q3 vs its $28M operating loss last year. The company’s cost increases weren’t limited to the $1.59B it spent on technology and content. But it stood out as the company also reported slowing growth in media sales, up 7% in the quarter vs 13% last year. Amazon CEO Jeff Bezos remains upbeat, though, especially about his streaming service. “Prime Instant Video has surpassed 40,000 titles, including many premium exclusives like Downton Abbey and Under The Dome,” he said.
By DAVID LIEBERMAN, Financial Editor | Thursday July 25, 2013 @ 5:44pm EDTTags: Amazon, Amazon Studios
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This article was printed from http://www.deadline.com/2013/07/amazon-reports-q2-loss-entertainment-outlays-grow/
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