Amazon’s revenue tapered down significantly in Q2 2017 (ended this July) because of a price cut in the company’s AWS webhosting and cloud computing wing. A slowdown in the company’s revenue from outside the US also contributed to the reduced revenue. Revenue and operating expenses were roughly equal, at $37.96 billion and $37.33 billion respectively. Both grew by 25–28% from the same quarter in the previous year.
Alexa and Echo, Amazon’s voice recognition-enabled assistants, may be coming to India soon, Olsavsky indicated. “We continue to invest in, as I said, fulfillment capacity and logistics services, digital video, our Echo and Alexa, Echo devices and Alexa platform [in] India.”
ET reported this June that the devices have already been distributed to some analysts and Amazon employees in India for testing. The report cited anonymous sources who said that the devices would be released in India towards the end of this year.
Investment in India
Olsavsky said that investments in India were seeing an uptick — not entirely unexpected considering the huge amounts of money they’re pumping into their business here. For instance, there’s the ₹130 crore they invested in Amazon Pay, their payments arm; an approval for $500 million in FDI in online food retail; ₹341 crore in their wholesale business; and ₹1680 crore overall in India.
“We continue to invest in India. We’re very hopeful with the progress we’ve made with sellers and customers alike in India and we see great momentum and success there, so we continue to invest and we have some of our best people in that business,” Olsavsky said.
Video investments increasing
Amazon’s Prime Video service will see more investment this year, Olsavsky said. “Last year, I highlighted the fact that [ video content ] was going to be a significant step up between second half of 2016 and the second half of 2015. We are still – we lapped that most of the first half this year and we’ll also be increasing video spend on a sequential and year-over-year basis in Q3.”
Recently, Prime Video bought exclusive global rights to Salman Khan’s upcoming films in a five year deal. Mint quoted Amazon executives as saying the deal cost them “a small fortune”. The closest comparable deal to this would be the deal Shah Rukh Khan signed with Netflix. An analyst quoted by Mint estimated that each Salman Khan film’s exclusive digital rights cost ₹65 crore — by that metric, this five year deal should cost Amazon anywhere between ₹600–800 crores, much higher than the reported ₹500 crore deal reportedly looming between Aamir Khan and Netflix.
— Net sales increased 25% to $38.0 billion in Q2, compared to $30.4 billion in second quarter 2016.
— Net income was $197 million in Q2–2017 compared with $857 million in the same quarter last year.