I don't know what the traders were really expecting when Amazon reported losses two weeks ago. It's the same broken record for the past 20 years. Trust us, we are investing in the future. The future is an awesome alibi because it's always in the, well, future. It'll never come.
So the stock has been sliding since the earnings (or lack thereof) release. Still Amazon's valuation is sky-high with no discernible timeline on when investors will finally see at least an evidence of an earnings turnaround. One must wonder where Amazon gets its money to fund its operations and fill the financial holes quarter after quarter. Perhaps that comes from selling bonds, a cheap way to raise money these days and it does have its own cash reserves.
Now comes the news of Walmart renovating its web site to better compete with Amazon. Walmart is going to have a tough fight on its hands. They can personalize and optimize and modernize their site all they want, but how can one defeat a behemoth that doesn't care about how much money it loses quarter after quarter, year after year?
If only Walmart could convince its investors that losing money is sound business. It's a skill Amazon has polished and perfected since its inception. No doubt Amazon will lose more money in the next quarter and investors will flock back to the stock, bowing and worshiping.