Experiencing positive earnings for the fourth straight quarter in Q1 2016, Amazon may have received added vindication of its long-standing core business strategies. Born out of Jeff Bezos\u2019 vision of forming an \u2018exotic and large\u2019 company (metaphorically like South America and its Amazon River), America\u2019s largest online retailer has come a long way since Bezos started the company when he was only 30 years old.<\/p>\n
Fascinated by the internet revolution, Bezos quit his job as Vice President of a Wall Street firm in 1994 to build his dream company. Beginning in the garage of his Seattle home, the first round of start-up funding came from his parent\u2019s personal savings (his father had little knowledge of the internet at the time, as revealed by Bezos in an interview).<\/p>\n
Beginning as an online bookstore, Amazon garnered sales up to $20,000 per week after only a few months in business. In 1997, it went public at $18 per share on the NASDAQ. Kleiner Perkins Caufield & Byers saw a 55,000%+ return by 1999 on their $8 million investment made in 1995.<\/p>\n
Innovation and Expansion Drive Future Profits<\/strong><\/p>\n Though Bezos\u2019 unusual strategy of prioritizing investments in expansion\/innovation for long-term growth over profit-making may have made some investors skeptical, the e-commerce giant\u2019s survival through the dot com bust proved it to be a force. Amazon generated its first profit-amounting to $5 million in Q4 2001, on revenues exceeding $1 billion.<\/p>\n Heralded by Time magazine as the \u201cPerson of the Year\u201d in 1999 for his success in e-commerce, Bezos expanded his business to include electronics, apparels, jewelry, and more alongside books. Also noteworthy are the host of acquisitions, Amazon has made so far (close to 5), including Junglee, IMDb and Zappos.<\/p>\n Launching a convenient mode of e-reading through Kindle, introducing customer ratings on books and renting out computer server space as part of its cloud services, Amazon has been a pioneer in many areas. Its innovations are reaping huge benefits for the company with profits soaring to an all-time quarterly high of $513 million in Q1 2016 (compared to losses of $57 million a year ago). This surge was largely driven by cloud computing services.<\/p>\n Bezos to Expand Worldwide Networks<\/strong><\/p>\n Furthermore, Amazon is set to launch in-house shipping and logistics services to connect factories in China and India to customers in the New York, Atlanta and London (according to a 2013 report to Amazon\u2019s senior management team). The proposed project, named Dragon Boat, could potentially give some serious competition to incumbents like UPS and FedEx.<\/p>\n Its global expansion plans also include a $5 billion investment in India. In a recent meeting with global leaders in Washington, Bezos stated his intentions to inject $3 billion in the company\u2019s rapidly growing Indian market, adding to the previously committed $2 billion. He further expressed his vision to have Amazon\u2019s largest software engineering and development center placed outside the U.S. in Hyderabad, India. Bezos particularly emphasized the 45,000 jobs already created by his organization in India, and that he continues to see a lot of promise in the country.<\/p>\n Bottom Line for Investors<\/strong><\/p>\n Amazon is the epitome of a start-up success story. Notwithstanding early criticisms, the online retailer has emerged as one of the fastest growing companies while staying true to its core philosophy of encouraging innovation above everything else. With recent earnings results bearing further testimony to the juggernaut, it shouldn\u2019t be too surprising if its stock prices reach new highs in coming weeks.<\/p>\n \n","protected":false},"excerpt":{"rendered":" Experiencing positive earnings for the fourth straight quarter in Q1 2016, Amazon may have received added vindication of its long-standing […]<\/p>\n","protected":false},"author":1,"featured_media":4124,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[71,72],"tags":[],"class_list":["post-3340","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-private-client-group","category-steady-investor-news"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3340","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=3340"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3340\/revisions"}],"predecessor-version":[{"id":11289,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/3340\/revisions\/11289"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=3340"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=3340"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=3340"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}