No company right now is more constantly discussed, poked, prodded, loved, feared and generally obsessed over more than Amazon. So how is it that no one actually understands Amazon?
Remember when Apple was the most compelling and mysterious corporation in the world? We all behaved as if the Illuminati was making shiny toys in a secret bunker in Northern California, and Apple was happy to act the part. It felt like every quarter, sell-side analysts stayed up for days at a time trying to suss out what Apple's super-secret sales figures looked like for its newest toy. Apple played agonizingly coy, consensus estimates came out, Apple reported and beat handily. It was a comfortingly inevitable event, like the changing of the seasons.
But Apple never beat by almost 50 cents a share in a quarter that everyone thought it was due for a stumble. And can anyone remember a time when Apple's stock price jumped more than $120 in a matter of hours? Cuz, Amazon just did this:
We've all heard this a jillion times since yesterday's closing bell but it bears repeating; consensus EPS on Amazon was $0.04. Amazon reported earnings of $0.52 a share.
That's not a beat, it's a fucking mauling.
And yeah, it's super impressive that Jeff Bezos managed to integrate Whole Foods so seamlessly without burning too much cash while also growing Amazon Web Services by 42% and blah blah blah...But how did no one see this coming?!?!
How many stories about Amazon are written everyday? How many theories are going around at once about what entire industry Amazon might destroy next just to rebuild it in their own image? How many jokes have you heard in the past 24 hours about Jeff Bezos' newly buff physique?
The answer to all of those is "a shit-ton" and yet, at this time yesterday, a lot of people were shorting AMZN. Because Amazon is a $520 billion global monolith hiding in plain sight.
It would be easy to use this space to start shitposting sell-side retail analysts (and some of them deserve it) but it seems like we might all be better served by just tipping our caps a la Pedro Martinez and capitulating to the notion that Jeff Bezos is our daddy right now.
Let's be honest with ourselves for a moment: A major reason that Amazon was able to so viciously beat consensus is that we all really wanted them to fail this quarter.
Since the start of 2017, Amazon has gone from being merely an almost all-powerful force in the American retail sector to a sui generis corporate entity pushing up against the accepted boundaries of capitalism. Bezos spent $12 billion on Whole Foods, kept touting the future growth already massive cloud services business, had to deal with his own in-house Harvey Weinstein, was toying with smaller e-commerce players like an evil cat with a dead mouse. Also, he has just gotten too fucking ripped.
We all felt pretty confident yesterday afternoon that Bezos had arrived at his Icarus moment, didn't we? It was all too much to handle this time, and Amazon was finally about to feel the heat of its own limitations. The bears would feast on whatever fell back to Earth!
Welp, that motherfucker is still flying!
Like an e-commerce startup blissfully unaware of their place in the food chain, everyone shorting Amazon failed to remember one key metric: Jeff Bezos can see you.
Because. He. Sees. Everything.
The one person who gets Amazon better than anyone else knows that none of us get it very much at all. Bezos has always seemed to manage Amazon's financials with a deftness that seems impossible for a company with a market cap comparable to a small industrialized nation. He loves to massage things in time for a little shocker. Remember "Surprise profit"?
But Bezos didn't just paint the edges to make himself smile this time. This time, he made a statement, and that statement is "You don't know me!" He woke up as the richest man in the world today, and everyone who underestimated him woke up poorer.
So if you're a plebe who thought he understood Amazon yet woke up on the losing end of an historically bad trade, you might feel like popping some antidepressants. Well, good news, Jeff Bezos is about to sell those too! And he'll deliver you a bunch in time for Q4 results.
Jeff Bezos will see us all again in mid-January.