Tuesday October 28, 2014

• Amazon's non-US eCommerce business (EGM-only, not media) constitutes ~20% of total revenue and grew about 19% Y/Y in Q3: That's one of many interesting insights in a deep-dive by a well-known Amazon blogger. Amazon's geographical mix for the Q was 63% North America (growth 25% Y/Y), 37% non-domestic (13% Y/Y).  Amazon's 1P and 3P businesses are doing quite well and the problems are in media (25% of total revenue, which grew only 4%) and  non-seller oriented areas such as the Fire phone which had a  $170m write-down for the Q and Amazon is sitting on $83m in inventory. On a 2x2 of (EGM v Media) and (US v International), US EGM was the largest (~50%) and the fastest growing segment (31% Y/Y): every other segment is growing below the average. Amazon reported $20.6B in Q3 revenue, at 20% growth.

• Twitter earnings (Q3 rev: $361M, 114% Y/Y, net loss $175M) beat estimates, but the stock was still down 10% on engagement worries and lack of product innovation: Twitter is doing a great job monetizing (especially on mobile:85% of revenue from mobile), but engagement is stagnating: not enough new users (monthly active users rose only 23% to 284 million in the quarter) and decreasing engagement per user (timeline views per user slid 7% globally to 636). “The lack of growth there comes from Twitter’s relative lack of innovation,” said Nate Elliott, an analyst at Forrester who studies social media. “The experience on Twitter today is the same experience people have always had on Twitter.”

• AliPay and Apple Pay might join forces: Jack Ma and Tim Cook both repeatedly teased a possible partnership between The Paypal-like AliPay and Apple Pay in two separate talks while on stage at the Wall Street Journal Digital conference in Laguna Beach, California this evening. An Apple Pay/AliPay partnership is certainly intriguing. Apple Pay activated over 1 million credit cards within the first 72 hours of going live with the service, making it a strong contender in the digital payment space. AliPay dominates in online payments for a good chunk of the rest of the world and, as Ma pointed out on stage, “Alipay is now the third largest payment system in the world, behind Visa and Mastercard.”.

• Separately, Alibaba's mutual fund has shrunk a bit - from $92B to $87B as big Chinese state-owned banks respond to competition: Alibaba’s mutual fund Yuebao garnered a lot of attention when it first launched last summer, and at first, it grew extremely fast. But by this July, it had begun to stagnate, and now according to the latest numbers, investment in Yuebao is actually dropping. Its still huge though: at $87B down from $92B Yuebao has been limited by government restrictions that emerged around March, which made it harder for customers to shift funds to online rivals, imposed transfer limits, banned new types of payments such as QR codes, and halted the launch of virtual credit cards. Alibaba chairman Jack Ma publicly slammed the central bank and big four for abusing their ‘monopoly’.