{"id":8184,"date":"2022-12-26T22:11:55","date_gmt":"2022-12-26T22:11:55","guid":{"rendered":"https:\/\/dmsretail.com\/RetailNews\/jason-scot-show-episode-294-amazon-q2-2022-earnings\/"},"modified":"2022-12-26T22:11:55","modified_gmt":"2022-12-26T22:11:55","slug":"jason-scot-show-episode-294-amazon-q2-2022-earnings","status":"publish","type":"post","link":"https:\/\/dmsretail.com\/RetailNews\/jason-scot-show-episode-294-amazon-q2-2022-earnings\/","title":{"rendered":"Jason &#038; Scot Show Episode 294 &#8211; Amazon Q2 2022 Earnings"},"content":{"rendered":"<p> <p><a href=\"https:\/\/dmsretail.com\/online-workshops-list\/\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-496\" src=\"https:\/\/dmsretail.com\/RetailNews\/wp-content\/uploads\/2022\/05\/RETAIL-ONLINE-TRAINING-728-X-90.png\" alt=\"Retail Online Training\" width=\"729\" height=\"91\" srcset=\"https:\/\/dmsretail.com\/RetailNews\/wp-content\/uploads\/2022\/05\/RETAIL-ONLINE-TRAINING-728-X-90.png 729w, https:\/\/dmsretail.com\/RetailNews\/wp-content\/uploads\/2022\/05\/RETAIL-ONLINE-TRAINING-728-X-90-300x37.png 300w\" sizes=\"auto, (max-width: 729px) 100vw, 729px\" \/><\/a><\/p><br \/>\n<\/p>\n<div>\n<p>A weekly podcast with the latest e-commerce news and events. Episode 294 is a recap of Amazon\u2019s earnings for Q2 2022.<\/p>\n<p> <span id=\"more-26189\"\/><\/p>\n<p><strong>Subscribe:<br \/><\/strong><\/p>\n<figure><iframe loading=\"lazy\" style=\"border: none;\" src=\"http:\/\/html5-player.libsyn.com\/embed\/episode\/id\/23929746\/height\/360\/width\/640\/theme\/standard-mini\/autoplay\/no\/autonext\/no\/thumbnail\/yes\/preload\/no\/no_addthis\/no\/direction\/backward\/no-cache\/true\/\" width=\"640\" height=\"360\" scrolling=\"no\" allowfullscreen=\"allowfullscreen\"><span data-mce-type=\"bookmark\" style=\"display: inline-block; width: 0px; overflow: hidden; line-height: 0;\" class=\"mce_SELRES_start\">?<\/span><span style=\"display: inline-block; width: 0px; overflow: hidden; line-height: 0;\" data-mce-type=\"bookmark\" class=\"mce_SELRES_start\">?<\/span><span style=\"display: inline-block; width: 0px; overflow: hidden; line-height: 0;\" data-mce-type=\"bookmark\" class=\"mce_SELRES_start\">?<\/span><span style=\"display: inline-block; width: 0px; overflow: hidden; line-height: 0;\" data-mce-type=\"bookmark\" class=\"mce_SELRES_start\">?<\/span><span data-mce-type=\"bookmark\" style=\"display: inline-block; width: 0px; overflow: hidden; line-height: 0;\" class=\"mce_SELRES_start\">?<\/span><\/iframe><\/figure>\n<p>Episode 294 is a breakdown of Amazon\u2019s Q2 2022 earnings.<\/p>\n<p>Episode 294 of the Jason &amp; Scot show was recorded on Sunday July 31, 2022.<\/p>\n<h2 id=\"chapter\">Transcript<\/h2>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[0:23]<\/small>\u00a0<span title=\"0:23 - 0:38\" data-start=\"00:00:23.135\" data-end=\"00:00:38.050\" data-spk=\"0\" data-label=\"Jason\">Welcome to the Jason and Scot show this is episode 294 being recorded on Sunday July 31st 2022 I\u2019m your host Jason retailgeek Goldberg and as usual I\u2019m here with your co-host Scot Wingo.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[0:38]<\/small>\u00a0<span title=\"0:38 - 0:44\" data-start=\"00:00:38.308\" data-end=\"00:00:44.341\" data-spk=\"1\" data-label=\"Scot\">Hey Jason and welcome back Jason and Scott strip show listeners well we have had a<\/span><br \/><span title=\"0:44 - 0:59\" data-start=\"00:00:44.245\" data-end=\"00:00:58.853\" data-spk=\"1\" data-label=\"Scot\">plethora of vacations Jason did a business trip he\u2019s going to report on over it in our F and then I had a little covid situation so it\u2019s been The Universe has been trying to keep us from podcast so it\u2019s great to be back in the saddle tonight Jason.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[0:59]<\/small>\u00a0<span title=\"0:59 - 1:03\" data-start=\"00:00:58.721\" data-end=\"00:01:03.306\" data-spk=\"0\" data-label=\"Jason\">I am thrilled to be chatting with you on a rare Sunday night this is unusual for us.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[1:04]<\/small>\u00a0<span title=\"1:04 - 1:11\" data-start=\"00:01:03.522\" data-end=\"00:01:10.577\" data-spk=\"1\" data-label=\"Scot\">It is it is usually we watch our Disney movies have a little popcorn in called an evening but tonight we\u2019re going to throw down a podcast.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[1:11]<\/small>\u00a0<span title=\"1:11 - 1:16\" data-start=\"00:01:10.673\" data-end=\"00:01:16.375\" data-spk=\"0\" data-label=\"Jason\">We I feel like we need to get ahead a little bit because you know there\u2019s a new Game of Thrones series coming soon.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[1:16]<\/small>\u00a0<span title=\"1:16 - 1:23\" data-start=\"00:01:16.075\" data-end=\"00:01:22.757\" data-spk=\"1\" data-label=\"Scot\">I know and Lord of the Rings we got a lot a lot of geekdom kind of happening all at once here.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[1:23]<\/small>\u00a0<span title=\"1:23 - 1:32\" data-start=\"00:01:22.806\" data-end=\"00:01:31.717\" data-spk=\"0\" data-label=\"Jason\">Exciting stuff and even more exciting than all of that Scott I\u2019m super grateful that you\u2019re feeling well and recovered<\/span><br \/><span title=\"1:32 - 1:40\" data-start=\"00:01:31.585\" data-end=\"00:01:40.021\" data-spk=\"0\" data-label=\"Jason\">but mental picture for our listeners I have a mild version of what Jason considers a tan for the show which is super rare.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[1:40]<\/small>\u00a0<span title=\"1:40 - 1:49\" data-start=\"00:01:40.058\" data-end=\"00:01:48.566\" data-spk=\"1\" data-label=\"Scot\">Wow and that is because you went to a that summer in RF show that\u2019s out in a ranch somewhere tell us about that.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[1:48]<\/small>\u00a0<span title=\"1:48 - 1:58\" data-start=\"00:01:48.380\" data-end=\"00:01:57.988\" data-spk=\"0\" data-label=\"Jason\">Yeah I doubled down so I had a week of vacation in Upper Lake Michigan and then I went straight from there as one does when you work hard to a quote-unquote work trip<\/span><br \/><span title=\"1:58 - 2:05\" data-start=\"00:01:57.869\" data-end=\"00:02:05.458\" data-spk=\"0\" data-label=\"Jason\">which is in Ranchos Palos Verdes at The Tiara new resort on the beach in southern California.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[2:07]<\/small>\u00a0<span title=\"2:07 - 2:16\" data-start=\"00:02:06.594\" data-end=\"00:02:16.286\" data-spk=\"1\" data-label=\"Scot\">Cool and then so I\u2019ve been turning our F of n this time of year that was called the merchandise or the merch conference is that what you want to.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[2:16]<\/small>\u00a0<span title=\"2:16 - 2:25\" data-start=\"00:02:15.986\" data-end=\"00:02:24.693\" data-spk=\"0\" data-label=\"Jason\">You are old school so originally when shoppbs.org and NRF were two separate entities shoppbs.org had a,<\/span><br \/><span title=\"2:25 - 2:34\" data-start=\"00:02:24.753\" data-end=\"00:02:34.121\" data-spk=\"0\" data-label=\"Jason\">fall summer event at this Resort that was exclusively focused on like digital merchandising and you\u2019re exactly right it was a great event called the merch Summit.<\/span><br \/><span title=\"2:34 - 2:49\" data-start=\"00:02:34.452\" data-end=\"00:02:48.813\" data-spk=\"0\" data-label=\"Jason\">And so this is kind of the spiritual successor to that than in a ref also had a event at the same time of year that was called the CIO Summit where all the cios got together and so they\u2019ve kind of mashed those two events together change them a little bit<\/span><br \/><span title=\"2:49 - 2:56\" data-start=\"00:02:48.783\" data-end=\"00:02:56.402\" data-spk=\"0\" data-label=\"Jason\">try to make it even more inclusive and they now call it an RF Nexus and so it\u2019s focused on,<\/span><br \/><span title=\"2:56 - 3:02\" data-start=\"00:02:56.481\" data-end=\"00:03:02.369\" data-spk=\"0\" data-label=\"Jason\">really forward-looking Trends and technologies that are relevant to<\/span><br \/><span title=\"3:02 - 3:14\" data-start=\"00:03:02.334\" data-end=\"00:03:14.345\" data-spk=\"0\" data-label=\"Jason\">e-commerce professionals to digital leaders to cios and to see a Moe\u2019s so there was a you know kind of like senior execs across it marketing and.<\/span><br \/><span title=\"3:15 - 3:17\" data-start=\"00:03:14.580\" data-end=\"00:03:16.941\" data-spk=\"0\" data-label=\"Jason\">Digital all in attendance.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[3:17]<\/small>\u00a0<span title=\"3:17 - 3:24\" data-start=\"00:03:17.248\" data-end=\"00:03:23.575\" data-spk=\"1\" data-label=\"Scot\">Nice nicer than what was the was there a topic to the event or what.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[3:24]<\/small>\u00a0<span title=\"3:24 - 3:28\" data-start=\"00:03:23.648\" data-end=\"00:03:28.022\" data-spk=\"0\" data-label=\"Jason\">So there are a range of forward-looking topics.<\/span><br \/><span title=\"3:29 - 3:42\" data-start=\"00:03:28.617\" data-end=\"00:03:42.041\" data-spk=\"0\" data-label=\"Jason\">Like probably the trend that topic that got brought up most were various aspects of the metaverse and some of those conversations came very close to getting me kicked out of the.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[3:43]<\/small>\u00a0<span title=\"3:43 - 3:46\" data-start=\"00:03:42.595\" data-end=\"00:03:45.561\" data-spk=\"1\" data-label=\"Scot\">Because you are.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[3:45]<\/small>\u00a0<span title=\"3:45 - 3:47\" data-start=\"00:03:45.311\" data-end=\"00:03:46.530\" data-spk=\"0\" data-label=\"Jason\">Because I\u2019ve become.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[3:46]<\/small>\u00a0<span title=\"3:46 - 3:47\" data-start=\"00:03:46.280\" data-end=\"00:03:47.305\" data-spk=\"1\" data-label=\"Scot\">VR headsets.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[3:47]<\/small>\u00a0<span title=\"3:47 - 3:49\" data-start=\"00:03:47.173\" data-end=\"00:03:49.108\" data-spk=\"0\" data-label=\"Jason\">I become a huge cremation.<\/span><br \/><span title=\"3:50 - 3:59\" data-start=\"00:03:49.673\" data-end=\"00:03:58.939\" data-spk=\"0\" data-label=\"Jason\">I know that\u2019s shocking to listeners who find me like wildly optimistic but you know we had a lot of outside speakers talking about the metaverse and.<\/span><br \/><span title=\"3:59 - 4:11\" data-start=\"00:03:59.402\" data-end=\"00:04:11.330\" data-spk=\"0\" data-label=\"Jason\">Spoiler alert I think the metaverse is super interesting it absolutely could be an important part of the future and when people say metaverse they\u2019re mostly talking about three things that don\u2019t necessarily go together but can which is.<\/span><br \/><span title=\"4:12 - 4:23\" data-start=\"00:04:11.973\" data-end=\"00:04:22.621\" data-spk=\"0\" data-label=\"Jason\">In ftes and blockchain stuff they\u2019re talking about the actual metaverse which is kind of like you know virtual reality and they\u2019re also talking about web 3.0.<\/span><\/p>\n<p><small>[4:24]<\/small>\u00a0<span title=\"4:24 - 4:28\" data-start=\"00:04:23.943\" data-end=\"00:04:28.395\" data-spk=\"0\" data-label=\"Jason\">And so they brought in a bunch of authors and subject matter experts,<\/span><br \/><span title=\"4:29 - 4:38\" data-start=\"00:04:28.522\" data-end=\"00:04:37.571\" data-spk=\"0\" data-label=\"Jason\">that are super bullish and are like it\u2019s a foregone conclusion that the future is with three and everyone\u2019s going to abandon web 2 and if you haven\u2019t already gone your,<\/span><br \/><span title=\"4:38 - 4:46\" data-start=\"00:04:37.596\" data-end=\"00:04:46.026\" data-spk=\"0\" data-label=\"Jason\">wheezes and secured your property in the metaverse then you\u2019re stupid and you\u2019re going to lose huge sums of money.<\/span><br \/><span title=\"4:46 - 4:50\" data-start=\"00:04:46.267\" data-end=\"00:04:49.800\" data-spk=\"0\" data-label=\"Jason\">And I disagree with most of that like I feel like it\u2019s.<\/span><br \/><span title=\"4:50 - 5:01\" data-start=\"00:04:50.467\" data-end=\"00:05:01.325\" data-spk=\"0\" data-label=\"Jason\">Wildly more up in the air than that and like at the moment first-movers that have tried to do Commerce things in the meadow verse have made more mistakes than not and so I spent a fair amount of time.<\/span><br \/><span title=\"5:02 - 5:12\" data-start=\"00:05:01.806\" data-end=\"00:05:12.195\" data-spk=\"0\" data-label=\"Jason\">Like debunking some of those claims and highlighting some of the catastrophic mistakes that people have been making when they when they try to make a splash in the metaverse Without Really knowing what they\u2019re doing and,<\/span><br \/><span title=\"5:12 - 5:21\" data-start=\"00:05:12.274\" data-end=\"00:05:20.500\" data-spk=\"0\" data-label=\"Jason\">I choose to believe that the attendees appreciated that counter perspective but I don\u2019t think some of the speakers appreciated being challenged.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[5:20]<\/small>\u00a0<span title=\"5:20 - 5:27\" data-start=\"00:05:20.290\" data-end=\"00:05:27.288\" data-spk=\"1\" data-label=\"Scot\">What to do a deep dive where you essentially just dumped on the metaverse Jason dumps on the metaverse.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[5:27]<\/small>\u00a0<span title=\"5:27 - 5:28\" data-start=\"00:05:27.267\" data-end=\"00:05:28.306\" data-spk=\"0\" data-label=\"Jason\">Well or.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[5:28]<\/small>\u00a0<span title=\"5:28 - 5:30\" data-start=\"00:05:28.080\" data-end=\"00:05:29.664\" data-spk=\"1\" data-label=\"Scot\">Be part of our curmudgeon series.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[5:29]<\/small>\u00a0<span title=\"5:29 - 5:35\" data-start=\"00:05:29.364\" data-end=\"00:05:35.348\" data-spk=\"0\" data-label=\"Jason\">Yeah a dose of reality about them again it could be a big thing I\u2019m not saying it\u2019s not I\u2019m just saying it\u2019s not a guaranteed big.<\/span><br \/><span title=\"5:36 - 5:42\" data-start=\"00:05:35.661\" data-end=\"00:05:41.526\" data-spk=\"0\" data-label=\"Jason\">And then a close cousin of that that I spoke was,<\/span><br \/><span title=\"5:42 - 5:52\" data-start=\"00:05:41.550\" data-end=\"00:05:52.017\" data-spk=\"0\" data-label=\"Jason\">the future of artificial intelligence for Commerce and I\u2019m kind of and we\u2019ve talked about this before but I\u2019m kind of a curmudgeon on that as well only because.<\/span><br \/><span title=\"5:52 - 6:03\" data-start=\"00:05:52.463\" data-end=\"00:06:03.405\" data-spk=\"0\" data-label=\"Jason\">I think focusing on artificial intelligence is kind of silly like to me artificial intelligence is a tactic not an outcome and there are a bunch of super exciting outcomes that are,<\/span><br \/><span title=\"6:03 - 6:11\" data-start=\"00:06:03.453\" data-end=\"00:06:10.748\" data-spk=\"0\" data-label=\"Jason\">made much better by using artificial intelligence and so I talked about some use cases that I\u2019m super excited about.<\/span><br \/><span title=\"6:11 - 6:21\" data-start=\"00:06:10.922\" data-end=\"00:06:21.029\" data-spk=\"0\" data-label=\"Jason\">But but I you know caveat that with they\u2019re not super exciting just because of the math that causes them to be artificial intelligence their super exciting because<\/span><br \/><span title=\"6:21 - 6:26\" data-start=\"00:06:20.946\" data-end=\"00:06:25.987\" data-spk=\"0\" data-label=\"Jason\">they help people find more stuff to buy and have more successful shopping trips.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[6:26]<\/small>\u00a0<span title=\"6:26 - 6:41\" data-start=\"00:06:25.687\" data-end=\"00:06:41.376\" data-spk=\"1\" data-label=\"Scot\">Cool well that\u2019s that\u2019s definitely out there and we have history on the show of given our listeners more of the hot truth of what\u2019s going on right now so it was a it was a really interesting second quarter reporting period so we wanted to spend the bulk of our time today<\/span><br \/><span title=\"6:41 - 6:42\" data-start=\"00:06:41.166\" data-end=\"00:06:42.398\" data-spk=\"1\" data-label=\"Scot\">reporting on that<\/span><br \/><span title=\"6:42 - 6:54\" data-start=\"00:06:42.182\" data-end=\"00:06:54.404\" data-spk=\"1\" data-label=\"Scot\">I want you to lay the scene for us mr. US Department of Commerce what what\u2019s what are the things feeling like there and then you know I think we\u2019re all pretty red in on the macro that consumer confidence is like<\/span><br \/><span title=\"6:54 - 6:55\" data-start=\"00:06:54.374\" data-end=\"00:06:55.029\" data-spk=\"1\" data-label=\"Scot\">what<\/span><br \/><span title=\"6:55 - 7:05\" data-start=\"00:06:54.963\" data-end=\"00:07:04.944\" data-spk=\"1\" data-label=\"Scot\">10 20 year lows inflation\u2019s at 40 year highs we had two quarters of negative growth that used to be called recession but no longer is called a recession.<\/span><br \/><span title=\"7:05 - 7:08\" data-start=\"00:07:05.275\" data-end=\"00:07:07.960\" data-spk=\"1\" data-label=\"Scot\">So yeah so.<\/span><br \/><span title=\"7:08 - 7:18\" data-start=\"00:07:08.231\" data-end=\"00:07:18.097\" data-spk=\"1\" data-label=\"Scot\">So that\u2019s kind of the macro backdrop and then then I saw you had done your normal really great analysis of the US Department of Commerce what\u2019s that looking like.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[7:18]<\/small>\u00a0<span title=\"7:18 - 7:29\" data-start=\"00:07:18.026\" data-end=\"00:07:28.812\" data-spk=\"0\" data-label=\"Jason\">Yeah and there\u2019s not a lot like super game-changing in the in the monthly data from the US Department of Commerce I like is you just kind of called out I feel like we\u2019ve just made this transition from.<\/span><br \/><span title=\"7:29 - 7:39\" data-start=\"00:07:29.088\" data-end=\"00:07:38.913\" data-spk=\"0\" data-label=\"Jason\">Overheated economy due to stimulus and extra covid demand and certainly a greater level of uncertainty and fluctuation but like in general,<\/span><br \/><span title=\"7:39 - 7:47\" data-start=\"00:07:39.003\" data-end=\"00:07:47.464\" data-spk=\"0\" data-label=\"Jason\">really robust retail sales to now we\u2019re having really robust retail sales because of inflation and so you know,<\/span><br \/><span title=\"7:48 - 7:57\" data-start=\"00:07:47.578\" data-end=\"00:07:57.174\" data-spk=\"0\" data-label=\"Jason\">looking at the numbers they\u2019re pretty consistent with the last couple months of numbers we\u2019ve seen and so in general like July retail sales were up 8.3% from July of last year,<\/span><br \/><span title=\"7:57 - 8:04\" data-start=\"00:07:57.271\" data-end=\"00:08:04.223\" data-spk=\"0\" data-label=\"Jason\">and year-to-date all retail sales from from January through July of this year are up 8.8%,<\/span><br \/><span title=\"8:04 - 8:10\" data-start=\"00:08:04.344\" data-end=\"00:08:10.016\" data-spk=\"0\" data-label=\"Jason\">from July of last year so ordinarily we would expect retail to be up.<\/span><\/p>\n<p><small>[8:11]<\/small>\u00a0<span title=\"8:11 - 8:15\" data-start=\"00:08:10.527\" data-end=\"00:08:14.853\" data-spk=\"0\" data-label=\"Jason\">I\u2019ll call it you know three to four and a half points so being up 8.8 is a.<\/span><br \/><span title=\"8:15 - 8:21\" data-start=\"00:08:15.046\" data-end=\"00:08:21.229\" data-spk=\"0\" data-label=\"Jason\">Significantly higher growth obviously a chunk of that growth is.<\/span><br \/><span title=\"8:22 - 8:26\" data-start=\"00:08:21.512\" data-end=\"00:08:26.282\" data-spk=\"0\" data-label=\"Jason\">Fairly attributed to inflation and people having to spend more.<\/span><br \/><span title=\"8:26 - 8:40\" data-start=\"00:08:26.427\" data-end=\"00:08:39.719\" data-spk=\"0\" data-label=\"Jason\">But you know inflation is kind of I feel like is misunderstood and people talk about about it being one number consumers spend a bunch of money on a big basket of goods and the amount of inflation on each item in that basket of goods.<\/span><br \/><span title=\"8:40 - 8:44\" data-start=\"00:08:40.038\" data-end=\"00:08:44.201\" data-spk=\"0\" data-label=\"Jason\">Varies wildly right so the amount of inflation we\u2019re seeing in gasoline.<\/span><br \/><span title=\"8:44 - 8:54\" data-start=\"00:08:44.400\" data-end=\"00:08:54.393\" data-spk=\"0\" data-label=\"Jason\">And certain food items is really high consumer electronics are actually deflating it\u2019s a you\u2019ll get a cheaper TV this year than you did last year right so.<\/span><br \/><span title=\"8:55 - 8:57\" data-start=\"00:08:54.580\" data-end=\"00:08:57.055\" data-spk=\"0\" data-label=\"Jason\">So you know if you break down in a segments.<\/span><br \/><span title=\"8:57 - 9:07\" data-start=\"00:08:57.314\" data-end=\"00:09:06.808\" data-spk=\"0\" data-label=\"Jason\">Segments that have high inflation and you know we\u2019re negatively affected by the pandemic the last couple of years are killing it right now so it\u2019s a great time to own a gas station like that.<\/span><br \/><span title=\"9:07 - 9:10\" data-start=\"00:09:06.946\" data-end=\"00:09:09.566\" data-spk=\"0\" data-label=\"Jason\">Gas stations are up 50% year-over-year.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[9:10]<\/small>\u00a0<span title=\"9:10 - 9:17\" data-start=\"00:09:10.161\" data-end=\"00:09:17.071\" data-spk=\"1\" data-label=\"Scot\">Yes cool and then it\u2019s too early to get the online number from the US Department of Commerce right that that\u2019s got it.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[9:17]<\/small>\u00a0<span title=\"9:17 - 9:27\" data-start=\"00:09:17.023\" data-end=\"00:09:27.419\" data-spk=\"0\" data-label=\"Jason\">Yeah we don\u2019t have the quarterly number but the proxy that we do get is this like non-store sales and that\u2019s a nine point six percent from last year so we\u2019re<\/span><br \/><span title=\"9:27 - 9:33\" data-start=\"00:09:27.359\" data-end=\"00:09:32.917\" data-spk=\"0\" data-label=\"Jason\">where the brick-and-mortar number is up more than you would usually expect the.<\/span><br \/><span title=\"9:33 - 9:38\" data-start=\"00:09:33.284\" data-end=\"00:09:37.604\" data-spk=\"0\" data-label=\"Jason\">The non-star sales are e-commerce is up even higher but,<\/span><br \/><span title=\"9:38 - 9:50\" data-start=\"00:09:37.604\" data-end=\"00:09:49.730\" data-spk=\"0\" data-label=\"Jason\">probably a little lower than you would ordinarily expect we\u2019re kind of used to that kind of twelve to fifteen percent growth in the so you know 10% growth is a is a little bit lower.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[9:50]<\/small>\u00a0<span title=\"9:50 - 9:54\" data-start=\"00:09:49.623\" data-end=\"00:09:54.261\" data-spk=\"1\" data-label=\"Scot\">That\u2019s because we\u2019re that they\u2019ve got a comp problem because last year was such a surgery or with covid.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[9:54]<\/small>\u00a0<span title=\"9:54 - 9:56\" data-start=\"00:09:53.979\" data-end=\"00:09:55.685\" data-spk=\"0\" data-label=\"Jason\">Exactly exactly.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[9:56]<\/small>\u00a0<span title=\"9:56 - 10:06\" data-start=\"00:09:56.166\" data-end=\"00:10:05.991\" data-spk=\"1\" data-label=\"Scot\">Okay so that\u2019s one set up and then the other one was for some reason we\u2019ve entered this interesting period where Snapchat is one of the first companies to report and.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[10:06]<\/small>\u00a0<span title=\"10:06 - 10:08\" data-start=\"00:10:06.148\" data-end=\"00:10:07.794\" data-spk=\"0\" data-label=\"Jason\">They need to change that by the way.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[10:07]<\/small>\u00a0<span title=\"10:07 - 10:11\" data-start=\"00:10:07.494\" data-end=\"00:10:10.816\" data-spk=\"1\" data-label=\"Scot\">Yeah I don\u2019t think that\u2019s her they like it.<\/span><br \/><span title=\"10:11 - 10:19\" data-start=\"00:10:10.979\" data-end=\"00:10:19.043\" data-spk=\"1\" data-label=\"Scot\">Because in our Recaps they\u2019ve been kind of the first one to take it on the nose and it wasn\u2019t any different this quarter so July 21st they came out.<\/span><br \/><span title=\"10:19 - 10:29\" data-start=\"00:10:19.289\" data-end=\"00:10:28.825\" data-spk=\"1\" data-label=\"Scot\">And it was just a total mess and lower and a poop show because last quarter they basically said we got a handle on this we know what\u2019s going on with ID fa.<\/span><br \/><span title=\"10:29 - 10:40\" data-start=\"00:10:29.258\" data-end=\"00:10:40.140\" data-spk=\"1\" data-label=\"Scot\">You know I\u2019m going to another Victory lap on this because I feel like you and I were like super early on I DFA and it\u2019s really coming home to roost and interesting ways and Snapchat continues to be a,<\/span><br \/><span title=\"10:40 - 10:45\" data-start=\"00:10:40.261\" data-end=\"00:10:44.912\" data-spk=\"1\" data-label=\"Scot\">non beneficiary of those changes but then addition to that,<\/span><br \/><span title=\"10:45 - 11:00\" data-start=\"00:10:45.020\" data-end=\"00:10:59.586\" data-spk=\"1\" data-label=\"Scot\">you\u2019re more in that business that I am but I\u2019ve got to imagine that when you see recessionary head winds and and everyone\u2019s tucking in their expenses one of the first things that you look at is your ad spend right and you know maybe<\/span><br \/><span title=\"11:00 - 11:04\" data-start=\"00:10:59.574\" data-end=\"00:11:03.762\" data-spk=\"1\" data-label=\"Scot\">it\u2019s not a great place to be if you\u2019re Snapchat basically saying hey<\/span><br \/><span title=\"11:04 - 11:15\" data-start=\"00:11:03.738\" data-end=\"00:11:15.125\" data-spk=\"1\" data-label=\"Scot\">you know we\u2019re not really good anymore and measuring what\u2019s going on with your ads because it feels like I guess people would cut that they\u2019ve also become you know one of the smaller platforms so I imagined.<\/span><br \/><span title=\"11:16 - 11:31\" data-start=\"00:11:15.624\" data-end=\"00:11:30.574\" data-spk=\"1\" data-label=\"Scot\">They\u2019re probably out on experimental ring of AD spend and maybe they get cut from that too so they had a double whammy of both kind of micro meaning I DFA and then macro softness so that was just a total total nightmare<\/span><br \/><span title=\"11:30 - 11:32\" data-start=\"00:11:30.437\" data-end=\"00:11:31.830\" data-spk=\"1\" data-label=\"Scot\">quarter for them.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[11:33]<\/small>\u00a0<span title=\"11:33 - 11:43\" data-start=\"00:11:32.888\" data-end=\"00:11:43.470\" data-spk=\"0\" data-label=\"Jason\">No do it wasn\u2019t pretty 100% agree like I do think we call the that I DFA was going to be pretty substantial to some of these businesses but I do think.<\/span><br \/><span title=\"11:44 - 11:51\" data-start=\"00:11:43.873\" data-end=\"00:11:50.885\" data-spk=\"0\" data-label=\"Jason\">Some of there\u2019s like there they were mostly trying to blame it all on IDF a and I do think there\u2019s some softness in.<\/span><br \/><span title=\"11:51 - 12:05\" data-start=\"00:11:51.174\" data-end=\"00:12:04.856\" data-spk=\"0\" data-label=\"Jason\">Digital marketing spend right now right I guess you go into recession it\u2019s not the right thing to do but you know a lot of people that are nervous about their economic future are you know slow down their marketing spend right and it\u2019s kind of like<\/span><br \/><span title=\"12:05 - 12:07\" data-start=\"00:12:04.803\" data-end=\"00:12:07.290\" data-spk=\"0\" data-label=\"Jason\">when when you start to Skid on the ice.<\/span><br \/><span title=\"12:07 - 12:21\" data-start=\"00:12:07.453\" data-end=\"00:12:21.111\" data-spk=\"0\" data-label=\"Jason\">You know it\u2019s not very smart to hit the brakes but it\u2019s human nature to hit the brakes and and you know some people people are doing that right now and I think some of their their softness and then you know some of the softness in the other AD platforms we\u2019re going to talk about,<\/span><br \/><span title=\"12:21 - 12:31\" data-start=\"00:12:21.237\" data-end=\"00:12:30.749\" data-spk=\"0\" data-label=\"Jason\">is is related to that recessionary fear and the ongoing impact of the various privacy initiatives.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[12:30]<\/small>\u00a0<span title=\"12:30 - 12:39\" data-start=\"00:12:30.485\" data-end=\"00:12:38.982\" data-spk=\"1\" data-label=\"Scot\">Yes so then we were all like okay that\u2019s that\u2019s Snapchat maybe it\u2019s isolated and then we had five days till Google was going to announce,<\/span><br \/><span title=\"12:39 - 12:53\" data-start=\"00:12:39.060\" data-end=\"00:12:53.133\" data-spk=\"1\" data-label=\"Scot\">or \/ alphabet there called a whole I will always call them Google and then there was a surprise announcement on July 24th Walmart basically came out and said hey we need to update our guidance that they had already lowered,<\/span><br \/><span title=\"12:53 - 13:05\" data-start=\"00:12:53.200\" data-end=\"00:13:05.464\" data-spk=\"1\" data-label=\"Scot\">for the quarter and they basically said sales are decent but profits are going to be way below kind of what we were talking about and they specifically called out some inventory problems so the CEO<\/span><br \/><span title=\"13:05 - 13:13\" data-start=\"00:13:05.404\" data-end=\"00:13:12.753\" data-spk=\"1\" data-label=\"Scot\">they now have everyone has a there\u2019s like 16 CEOs at Walmart or something but the CEO of us said,<\/span><br \/><span title=\"13:13 - 13:18\" data-start=\"00:13:12.861\" data-end=\"00:13:17.981\" data-spk=\"1\" data-label=\"Scot\">there\u2019s probably 20 percent of inventory if you could just wish it away and make it disappear you would,<\/span><br \/><span title=\"13:18 - 13:25\" data-start=\"00:13:18.089\" data-end=\"00:13:24.615\" data-spk=\"1\" data-label=\"Scot\">and then around that same time Target also came out and I think there\u2019s was even more severe,<\/span><br \/><span title=\"13:25 - 13:38\" data-start=\"00:13:24.693\" data-end=\"00:13:37.606\" data-spk=\"1\" data-label=\"Scot\">and then Walmart called out apparel as a problem area where basically I guess when you look at kind of your your wallet where you\u2019re spending money there\u2019s always,<\/span><br \/><span title=\"13:38 - 13:42\" data-start=\"00:13:37.655\" data-end=\"00:13:41.644\" data-spk=\"1\" data-label=\"Scot\">can\u2019t live without groceries but you can live without like that 10th pair of socks or,<\/span><br \/><span title=\"13:42 - 13:51\" data-start=\"00:13:41.651\" data-end=\"00:13:51.000\" data-spk=\"1\" data-label=\"Scot\">or a new outfit or something like that so it seems like consumers are definitely slowing down dramatically on the apparel side did you parse anything else out of the Walmart announced.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[13:51]<\/small>\u00a0<span title=\"13:51 - 13:55\" data-start=\"00:13:50.923\" data-end=\"00:13:55.015\" data-spk=\"0\" data-label=\"Jason\">Yeah I mean I feel like those are the main two takeaways I Walmart in particular<\/span><br \/><span title=\"13:55 - 14:12\" data-start=\"00:13:54.847\" data-end=\"00:14:11.966\" data-spk=\"0\" data-label=\"Jason\">like they\u2019re got they reduce their guidance from like eleven percent profit 21 percent profit right so pretty meaningful and essentially what they said is a we\u2019re starting to see significant changes in consumer Behavior as a result of the recession and or as a result of the inflation I should say<\/span><br \/><span title=\"14:12 - 14:19\" data-start=\"00:14:11.774\" data-end=\"00:14:19.195\" data-spk=\"0\" data-label=\"Jason\">and the the specific behavior we\u2019re seeing is people are spending more on Essentials and less on<\/span><br \/><span title=\"14:19 - 14:29\" data-start=\"00:14:19.027\" data-end=\"00:14:28.816\" data-spk=\"0\" data-label=\"Jason\">non-essentials and the non-essentials are more profitable for us so our mix is getting less profitable which is why we\u2019re adjusting our guidance and it also means<\/span><br \/><span title=\"14:29 - 14:34\" data-start=\"00:14:28.636\" data-end=\"00:14:34.254\" data-spk=\"0\" data-label=\"Jason\">that we have too much of these non essentials we were already you know heavy on them because we over ordered,<\/span><br \/><span title=\"14:34 - 14:43\" data-start=\"00:14:34.308\" data-end=\"00:14:43.231\" data-spk=\"0\" data-label=\"Jason\">during all the supply chain crisis and now we\u2019re having trouble moving them so Walmart didn\u2019t say this but a lot of other pundits have said this like you can<\/span><br \/><span title=\"14:43 - 14:49\" data-start=\"00:14:43.088\" data-end=\"00:14:49.246\" data-spk=\"0\" data-label=\"Jason\">expect to see all these Goods at Walmart and Target start to really get discounted and in one weird way,<\/span><br \/><span title=\"14:49 - 14:55\" data-start=\"00:14:49.349\" data-end=\"00:14:55.213\" data-spk=\"0\" data-label=\"Jason\">that\u2019s potentially good news for the economy because that that could actually help counter some of the inflation that everyone\u2019s talking about.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[14:56]<\/small>\u00a0<span title=\"14:56 - 15:02\" data-start=\"00:14:55.803\" data-end=\"00:15:02.442\" data-spk=\"1\" data-label=\"Scot\">Yeah yeah 10% profit change at Walmart\u2019s like a 40 billion dollar number.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[15:02]<\/small>\u00a0<span title=\"15:02 - 15:07\" data-start=\"00:15:02.148\" data-end=\"00:15:06.949\" data-spk=\"0\" data-label=\"Jason\">Yeah I will say and you you\u2019re the stock market guy I\u2019m not right so not shocking<\/span><br \/><span title=\"15:07 - 15:23\" data-start=\"00:15:06.787\" data-end=\"00:15:22.867\" data-spk=\"0\" data-label=\"Jason\">you come out and you revise your guidance in significantly down like that and not tracking your stock takes a pretty big haircut right so everyone wrote articles talking about the dipping the stock I happen to pick the stock right before we went on the show and its back it\u2019s completely rebuilt.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[15:23]<\/small>\u00a0<span title=\"15:23 - 15:31\" data-start=\"00:15:22.567\" data-end=\"00:15:31.478\" data-spk=\"1\" data-label=\"Scot\">Yeah it\u2019s always better to take your medicine and then if you\u2019re going to do it kitchen sink it and throw in some stuff because it\u2019s an expectation machine not necessarily an absolute.<\/span><br \/><span title=\"15:32 - 15:33\" data-start=\"00:15:31.953\" data-end=\"00:15:33.329\" data-spk=\"1\" data-label=\"Scot\">Machine<\/span><br \/><span title=\"15:33 - 15:52\" data-start=\"00:15:33.179\" data-end=\"00:15:51.855\" data-spk=\"1\" data-label=\"Scot\">okay so then everyone was like well that\u2019s not good but maybe it\u2019s isolated to stores let\u2019s see what Shopify does well then well then Google came out and Google was mixed probably less bad than people thought so their Core Business which is people going to google.com and typing in stuff it exceeded expectations<\/span><br \/><span title=\"15:52 - 16:01\" data-start=\"00:15:51.639\" data-end=\"00:16:00.520\" data-spk=\"1\" data-label=\"Scot\">but their ad business and then their YouTube business were under pressure and they basically kind of counteract that each other where they did talk about<\/span><br \/><span title=\"16:00 - 16:06\" data-start=\"00:16:00.364\" data-end=\"00:16:06.235\" data-spk=\"1\" data-label=\"Scot\">you\u2019re more macro head runs around the ad world and that advertisers were pulling back so they kind of,<\/span><br \/><span title=\"16:06 - 16:11\" data-start=\"00:16:06.259\" data-end=\"00:16:10.844\" data-spk=\"1\" data-label=\"Scot\">added on to that Snapchat message of some softness with ad spend.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[16:11]<\/small>\u00a0<span title=\"16:11 - 16:14\" data-start=\"00:16:11.120\" data-end=\"00:16:13.560\" data-spk=\"0\" data-label=\"Jason\">Yeah and just for Google followers I would<\/span><br \/><span title=\"16:13 - 16:22\" data-start=\"00:16:13.434\" data-end=\"00:16:21.648\" data-spk=\"0\" data-label=\"Jason\">add you know they\u2019re interested in comments Commerce particularly interesting just remember like the president of Google Commerce recently left,<\/span><br \/><span title=\"16:22 - 16:29\" data-start=\"00:16:21.684\" data-end=\"00:16:29.418\" data-spk=\"0\" data-label=\"Jason\">Bill ready to go to Pinterest right so they haven\u2019t announced a new head yet like I\u2019m expecting them to call me any day<\/span><br \/><span title=\"16:29 - 16:41\" data-start=\"00:16:29.196\" data-end=\"00:16:41.490\" data-spk=\"0\" data-label=\"Jason\">so we\u2019ll see where that goes but previously one of the things they\u2019d really been leaning into was YouTube for Commerce and they\u2019ve added a ton of Commerce capability to YouTube and it<\/span><br \/><span title=\"16:41 - 16:46\" data-start=\"00:16:41.388\" data-end=\"00:16:46.417\" data-spk=\"0\" data-label=\"Jason\">it varies it doesn\u2019t seem like that paying off quite yet in the Google world.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[16:47]<\/small>\u00a0<span title=\"16:47 - 17:00\" data-start=\"00:16:47.223\" data-end=\"00:17:00.472\" data-spk=\"1\" data-label=\"Scot\">Yeah and then everyone\u2019s like well let\u2019s see what Shopify does in so let\u2019s see after market close 26 was Google and then everyone was expecting Shopify to do something the next morning well then that evening Toby put out a Blog<\/span><br \/><span title=\"17:00 - 17:09\" data-start=\"00:17:00.437\" data-end=\"00:17:09.306\" data-spk=\"1\" data-label=\"Scot\">post saying hey we\u2019re laying off 10% of folks and then I was like oh boy that\u2019s not good the quarter must be really really bad.<\/span><br \/><span title=\"17:10 - 17:22\" data-start=\"00:17:09.523\" data-end=\"00:17:21.997\" data-spk=\"1\" data-label=\"Scot\">And it was really interesting to his credit I think Toby did a really good job in his blog post it\u2019s never easy to do these types of layoffs and I thought he did an exceptional job of laying out,<\/span><br \/><span title=\"17:22 - 17:31\" data-start=\"00:17:22.015\" data-end=\"00:17:31.035\" data-spk=\"1\" data-label=\"Scot\">why and essentially taking the blame for it basically saying he made a bet that this would be a pull forward it was you know.<\/span><\/p>\n<p><small>[17:32]<\/small>\u00a0<span title=\"17:32 - 17:36\" data-start=\"00:17:31.630\" data-end=\"00:17:35.752\" data-spk=\"1\" data-label=\"Scot\">And then when you\u2019re in the thick of it you do that was our logical,<\/span><br \/><span title=\"17:36 - 17:48\" data-start=\"00:17:35.812\" data-end=\"00:17:47.926\" data-spk=\"1\" data-label=\"Scot\">thing to think could happen and instead now we\u2019re reverting to the mean and they\u2019ve gotten way out of their skis what did you think about and then the next morning because he had taken their medicine,<\/span><br \/><span title=\"17:48 - 17:54\" data-start=\"00:17:48.035\" data-end=\"00:17:54.392\" data-spk=\"1\" data-label=\"Scot\">it wasn\u2019t quite as bad and then Wall Street actually likes it when Shopify gets rid of expenses because they\u2019ve added there,<\/span><br \/><span title=\"17:54 - 18:03\" data-start=\"00:17:54.464\" data-end=\"00:18:03.267\" data-spk=\"1\" data-label=\"Scot\">that\u2019s like a thousand people to them that they laid off our 10% so they\u2019ve grown their head count up to this kind of astronomical 10,000 folks and then they,<\/span><br \/><span title=\"18:03 - 18:12\" data-start=\"00:18:03.346\" data-end=\"00:18:12.101\" data-spk=\"1\" data-label=\"Scot\">is one of those little quizzical because then they said you know it\u2019s not going to change our ability to innovate or do anything basically so then you\u2019re kind of like wow I wonder wonder<\/span><br \/><span title=\"18:12 - 18:31\" data-start=\"00:18:11.987\" data-end=\"00:18:30.681\" data-spk=\"1\" data-label=\"Scot\">hey how\u2019s it feel to be one of those thousand people here in that part of the message and then be you know what did they do that you didn\u2019t really need them and they were in the sales they have all these content management people so kind of not developers not product and so part of their message was they were going to double triple down on on<\/span><br \/><span title=\"18:31 - 18:32\" data-start=\"00:18:30.513\" data-end=\"00:18:32.471\" data-spk=\"1\" data-label=\"Scot\">product development and adding features.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[18:33]<\/small>\u00a0<span title=\"18:33 - 18:47\" data-start=\"00:18:33.133\" data-end=\"00:18:46.959\" data-spk=\"0\" data-label=\"Jason\">Yeah I\u2019ll be interested to see how it plays out I got a ton of pings after that announcement because everybody did a Victory lap on my corpse right like everybody\u2019s calling and going ha ha mr. e-commerce guy<\/span><br \/><span title=\"18:47 - 18:55\" data-start=\"00:18:46.821\" data-end=\"00:18:55.023\" data-spk=\"0\" data-label=\"Jason\">e-commerce was an anomaly like it was it was big during the the pandemic but but now it\u2019s all gone see even Toby<\/span><br \/><span title=\"18:55 - 19:00\" data-start=\"00:18:54.982\" data-end=\"00:19:00.233\" data-spk=\"0\" data-label=\"Jason\">like over-invested in e-commerce and then he had to come out and say that he Comer sucks now.<\/span><br \/><span title=\"19:00 - 19:08\" data-start=\"00:19:00.402\" data-end=\"00:19:08.075\" data-spk=\"0\" data-label=\"Jason\">And so a I got a bunch of those kind of troll tweets that I had to respond to.<\/span><br \/><span title=\"19:08 - 19:14\" data-start=\"00:19:08.232\" data-end=\"00:19:13.814\" data-spk=\"0\" data-label=\"Jason\">And you know I have my own kind of issues \/ concerns with Shopify so a I would say.<\/span><br \/><span title=\"19:14 - 19:23\" data-start=\"00:19:14.223\" data-end=\"00:19:23.092\" data-spk=\"0\" data-label=\"Jason\">That shopify\u2019s actually been slower than I would like to see in product development leading up to this and in particular they have a product that\u2019s aimed at more Enterprises and less.<\/span><br \/><span title=\"19:23 - 19:29\" data-start=\"00:19:23.327\" data-end=\"00:19:29.383\" data-spk=\"0\" data-label=\"Jason\">Tiny businesses that\u2019s called the Shopify plus and most of the folks I talked to that have.<\/span><br \/><span title=\"19:30 - 19:38\" data-start=\"00:19:29.558\" data-end=\"00:19:38.120\" data-spk=\"0\" data-label=\"Jason\">Invest in Shopify plus I\u2019ve been pretty disappointed with the rate of innovation and product development on that platform and a bunch of the people that got laid off.<\/span><\/p>\n<p><small>[19:38]<\/small>\u00a0<span title=\"19:38 - 19:42\" data-start=\"00:19:38.487\" data-end=\"00:19:42.369\" data-spk=\"0\" data-label=\"Jason\">Where the teams associated with Shopify plus so that seems.<\/span><br \/><span title=\"19:43 - 19:53\" data-start=\"00:19:42.706\" data-end=\"00:19:52.644\" data-spk=\"0\" data-label=\"Jason\">Interesting to me and I will tell you that like in Toby\u2019s announcement he published this this US Department of Commerce Economic Development.<\/span><br \/><span title=\"19:53 - 20:02\" data-start=\"00:19:52.795\" data-end=\"00:20:01.610\" data-spk=\"0\" data-label=\"Jason\">Which of course you and I are super familiar with and we talked about all the time but eat accurately represented it right like that there\u2019s,<\/span><br \/><span title=\"20:02 - 20:16\" data-start=\"00:20:01.719\" data-end=\"00:20:15.593\" data-spk=\"0\" data-label=\"Jason\">e-commerce has been at the certain rate and during the you know from 2022 2022 we had this crazy Spike and you know if you look at where it is now and you draw a dotted line to the growth you would have expected before the the pandemic like the.<\/span><br \/><span title=\"20:16 - 20:28\" data-start=\"00:20:15.780\" data-end=\"00:20:28.374\" data-spk=\"0\" data-label=\"Jason\">The line is barely above where you would have expected so they called that regressing to the mean and you know gosh we exuberantly over-invested in now that it\u2019s come back to the mean we have to right-size.<\/span><br \/><span title=\"20:29 - 20:38\" data-start=\"00:20:28.579\" data-end=\"00:20:38.361\" data-spk=\"0\" data-label=\"Jason\">And so the only thing that\u2019s wrong with that graph is it\u2019s kind of a it visually doesn\u2019t represent,<\/span><br \/><span title=\"20:38 - 20:44\" data-start=\"00:20:38.440\" data-end=\"00:20:44.016\" data-spk=\"0\" data-label=\"Jason\">the huge amount of growth that\u2019s in the mean like the mean is very high so,<\/span><br \/><span title=\"20:44 - 20:56\" data-start=\"00:20:44.040\" data-end=\"00:20:55.944\" data-spk=\"0\" data-label=\"Jason\">from 2022 2022 we added four hundred and twelve billion dollars a year of e-commerce sales so e-commerce in United States of America Grew 61% From 2022 2022,<\/span><br \/><span title=\"20:56 - 21:05\" data-start=\"00:20:56.010\" data-end=\"00:21:05.312\" data-spk=\"0\" data-label=\"Jason\">so when when Shopify another say oh man we covid dim boost e-commerce as much as we thought we only grew 61 percent over the last two years.<\/span><\/p>\n<p><small>[21:06]<\/small>\u00a0<span title=\"21:06 - 21:15\" data-start=\"00:21:05.697\" data-end=\"00:21:14.572\" data-spk=\"0\" data-label=\"Jason\">Um like how many people did you hire right like you did you you didn\u2019t add 61 percent to their their staff commensurate with that growth.<\/span><br \/><span title=\"21:15 - 21:19\" data-start=\"00:21:14.861\" data-end=\"00:21:19.415\" data-spk=\"0\" data-label=\"Jason\">So yeah I just I take exception with people that think.<\/span><br \/><span title=\"21:20 - 21:33\" data-start=\"00:21:19.740\" data-end=\"00:21:33.044\" data-spk=\"0\" data-label=\"Jason\">That this data in some way shows some some significant softness and the other thing I would say is all of these graphs that these people are talking about they all like to show the percentage of e-commerce to Total retail and.<\/span><br \/><span title=\"21:33 - 21:41\" data-start=\"00:21:33.291\" data-end=\"00:21:41.306\" data-spk=\"0\" data-label=\"Jason\">It\u2019s easy to overlook and forget the fact that the denominator in that that ratio has been fluctuating wildly because of covid-19.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[21:42]<\/small>\u00a0<span title=\"21:42 - 21:56\" data-start=\"00:21:42.172\" data-end=\"00:21:55.981\" data-spk=\"1\" data-label=\"Scot\">Yeah yeah and then you know the other thing that mrs. is the it\u2019s like almost like a pie chart where you don\u2019t see the absolute dollars so so percentages are a tricky thing it\u2019s gonna be a better way to visualize it.<\/span><br \/><span title=\"21:56 - 22:10\" data-start=\"00:21:56.462\" data-end=\"00:22:09.717\" data-spk=\"1\" data-label=\"Scot\">One scary thing is maybe we don\u2019t revert to the mean like a week the you know the lines we haven\u2019t had enough time to know until that start sticking up you know we won\u2019t know if we\u2019re back on the mean or not who knows.<\/span><br \/><span title=\"22:10 - 22:11\" data-start=\"00:22:10.349\" data-end=\"00:22:10.949\" data-spk=\"1\" data-label=\"Scot\">Google.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[22:11]<\/small>\u00a0<span title=\"22:11 - 22:18\" data-start=\"00:22:10.673\" data-end=\"00:22:18.262\" data-spk=\"0\" data-label=\"Jason\">I know for sure but I get you know like I will do it maybe a Shopify deep dive at some point but like to me Shopify does is.<\/span><br \/><span title=\"22:18 - 22:29\" data-start=\"00:22:18.437\" data-end=\"00:22:29.235\" data-spk=\"0\" data-label=\"Jason\">Great product for small businesses it caters to this long tail in my biggest gripe with Shopify as an investor is always that they never tell you what they\u2019re stainless or sales are like they never tell you how well<\/span><br \/><span title=\"22:29 - 22:37\" data-start=\"00:22:29.079\" data-end=\"00:22:37.022\" data-spk=\"0\" data-label=\"Jason\">last year\u2019s customers did this year they just tell you the gmv of all the customers they currently have and so as far as We Know,<\/span><br \/><span title=\"22:37 - 22:47\" data-start=\"00:22:37.059\" data-end=\"00:22:46.829\" data-spk=\"0\" data-label=\"Jason\">more than 50% of their customers go out of business every year and then you know 50% of new mom and pop start a smart start a business and sign up with Shopify so<\/span><br \/><span title=\"22:47 - 23:00\" data-start=\"00:22:46.794\" data-end=\"00:22:59.514\" data-spk=\"0\" data-label=\"Jason\">the unlike a lot of other retail platforms that report their their data and when they grow we can kind of assume e-commerce grew shopify\u2019s growth can be 100% attributed to turn we just don\u2019t know.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[23:00]<\/small>\u00a0<span title=\"23:00 - 23:01\" data-start=\"00:22:59.936\" data-end=\"00:23:00.506\" data-spk=\"1\" data-label=\"Scot\">Yeah<\/span><br \/><span title=\"23:00 - 23:19\" data-start=\"00:23:00.410\" data-end=\"00:23:18.599\" data-spk=\"1\" data-label=\"Scot\">so then it was Thursday morning the 27th and meta formerly known as Facebook announced and that was a poop show so they had a myths of top and bottom and their second quarter of declining growth they threw the kitchen sink in there IDF a they\u2019re seeing macro issues<\/span><br \/><span title=\"23:18 - 23:27\" data-start=\"00:23:18.377\" data-end=\"00:23:27.487\" data-spk=\"1\" data-label=\"Scot\">Sheryl Sandberg is leaving and this has been announced for a while and then all the Talking Heads were like oh my God you know she<\/span><br \/><span title=\"23:27 - 23:33\" data-start=\"00:23:27.409\" data-end=\"00:23:32.865\" data-spk=\"1\" data-label=\"Scot\">when out of the top this is kind of the end of Facebook so that was that was pretty<\/span><br \/><span title=\"23:33 - 23:42\" data-start=\"00:23:32.823\" data-end=\"00:23:41.758\" data-spk=\"1\" data-label=\"Scot\">pretty negative sentiment there and then that brings us to the main topic we want to talk about which is after hours on Thursday Amazon announced.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[23:41]<\/small>\u00a0<span title=\"23:41 - 23:46\" data-start=\"00:23:41.458\" data-end=\"00:23:46.217\" data-spk=\"0\" data-label=\"Jason\">And Scott one thing before you jump in the Amazon like you forgot the most important thing about meta.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[23:46]<\/small>\u00a0<span title=\"23:46 - 23:48\" data-start=\"00:23:46.073\" data-end=\"00:23:48.324\" data-spk=\"1\" data-label=\"Scot\">What.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[23:48]<\/small>\u00a0<span title=\"23:48 - 23:50\" data-start=\"00:23:48.254\" data-end=\"00:23:50.267\" data-spk=\"0\" data-label=\"Jason\">The Kardashians are mad at them.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[23:50]<\/small>\u00a0<span title=\"23:50 - 23:56\" data-start=\"00:23:50.101\" data-end=\"00:23:55.922\" data-spk=\"1\" data-label=\"Scot\">Oh yes they changed Instagram in Kim\u2019s I don\u2019t I haven\u2019t tracked this you know it better than I do.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[23:56]<\/small>\u00a0<span title=\"23:56 - 24:07\" data-start=\"00:23:55.934\" data-end=\"00:24:06.984\" data-spk=\"0\" data-label=\"Jason\">Yeah I\u2019m just well it is an interesting thing will do another show about this at some point but like Instagram is has probably been the crown jewel of men of for a while and you know<\/span><br \/><span title=\"24:07 - 24:15\" data-start=\"00:24:06.883\" data-end=\"00:24:15.091\" data-spk=\"0\" data-label=\"Jason\">Instagram is getting a lot of competition from Tick Tock that the news feed and Tick-Tock is a lot more our rhythmic so the content you see<\/span><br \/><span title=\"24:15 - 24:22\" data-start=\"00:24:14.947\" data-end=\"00:24:22.157\" data-spk=\"0\" data-label=\"Jason\">is less related to who you particularly follow and more what the robots think they want to show you and the you know can monetize<\/span><br \/><span title=\"24:22 - 24:31\" data-start=\"00:24:22.037\" data-end=\"00:24:30.570\" data-spk=\"0\" data-label=\"Jason\">and so Facebook to try to follow suit is changing Instagram to be more algorithmic and less<\/span><br \/><span title=\"24:30 - 24:36\" data-start=\"00:24:30.402\" data-end=\"00:24:36.423\" data-spk=\"0\" data-label=\"Jason\">based on your followers and so if you\u2019re a mega influencer with 30 million followers<\/span><br \/><span title=\"24:36 - 24:46\" data-start=\"00:24:36.291\" data-end=\"00:24:46.181\" data-spk=\"0\" data-label=\"Jason\">you don\u2019t like that right like if you\u2019re Kim Kardashian you want everyone to see all of your content because they followed you you don\u2019t want them to see some unknown person that did something viral.<\/span><br \/><span title=\"24:47 - 24:54\" data-start=\"00:24:46.747\" data-end=\"00:24:54.462\" data-spk=\"0\" data-label=\"Jason\">And so the change that Instagram made is to be more like Tick-Tock and you know some of these big<\/span><br \/><span title=\"24:54 - 25:00\" data-start=\"00:24:54.444\" data-end=\"00:24:59.870\" data-spk=\"0\" data-label=\"Jason\">big influencers that benefited from the old model understandably don\u2019t like it in are criticizing it.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[25:01]<\/small>\u00a0<span title=\"25:01 - 25:06\" data-start=\"00:25:00.592\" data-end=\"00:25:06.312\" data-spk=\"1\" data-label=\"Scot\">Got it yeah we should definitely do a Kardashian deep dive how fun will that be.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[25:06]<\/small>\u00a0<span title=\"25:06 - 25:12\" data-start=\"00:25:06.012\" data-end=\"00:25:11.900\" data-spk=\"0\" data-label=\"Jason\">Yeah yeah finally be able to let Kylie on the show and so she\u2019ll stop bugging us.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[25:12]<\/small>\u00a0<span title=\"25:12 - 25:13\" data-start=\"00:25:12.183\" data-end=\"00:25:13.078\" data-spk=\"1\" data-label=\"Scot\">Good.<\/span><br \/><span title=\"25:13 - 25:27\" data-start=\"00:25:13.337\" data-end=\"00:25:26.923\" data-spk=\"1\" data-label=\"Scot\">Okay so if you\u2019ve been listening this recap there\u2019s two words I haven\u2019t said and those are beat and raised so then Thursday night Amazon came out and everyone was like oh boy this is gonna be bad<\/span><br \/><span title=\"25:27 - 25:33\" data-start=\"00:25:26.773\" data-end=\"00:25:32.986\" data-spk=\"1\" data-label=\"Scot\">and there was a CNBC person who actually like a lot of names Josh and.<\/span><br \/><span title=\"25:33 - 25:37\" data-start=\"00:25:33.317\" data-end=\"00:25:37.391\" data-spk=\"1\" data-label=\"Scot\">He was basically he they do this little lunch time.<\/span><br \/><span title=\"25:38 - 25:48\" data-start=\"00:25:37.662\" data-end=\"00:25:48.459\" data-spk=\"1\" data-label=\"Scot\">They have this investment committee they call it and he\u2019s had a short on Amazon because he kept thinking they were going to miss Q2 he basically said look with Walmart and Target basically reporting the way they have.<\/span><br \/><span title=\"25:49 - 25:58\" data-start=\"00:25:48.724\" data-end=\"00:25:58.176\" data-spk=\"1\" data-label=\"Scot\">To think Amazon would do differently means they have some totally different customer base I just don\u2019t think that\u2019s the case so Amazon surprised everyone with a beat and raised quarter.<\/span><br \/><span title=\"25:58 - 26:07\" data-start=\"00:25:58.459\" data-end=\"00:26:06.595\" data-spk=\"1\" data-label=\"Scot\">So how did they do that with all this you know we\u2019ve got Walmart Surprise Miss Shopify surprise Miss Google.<\/span><br \/><span title=\"26:07 - 26:15\" data-start=\"00:26:06.836\" data-end=\"00:26:15.140\" data-spk=\"1\" data-label=\"Scot\">Less worse meta terrible Snapchat total disaster in an Amazon just kind of came out and surprised everyone.<\/span><\/p>\n<p><small>[26:16]<\/small>\u00a0<span title=\"26:16 - 26:22\" data-start=\"00:26:15.657\" data-end=\"00:26:22.206\" data-spk=\"1\" data-label=\"Scot\">So so one way to think about Amazon is this very unique business and there\u2019s not a lot of.<\/span><br \/><span title=\"26:22 - 26:31\" data-start=\"00:26:22.399\" data-end=\"00:26:31.190\" data-spk=\"1\" data-label=\"Scot\">That you know another company like this that they have this portfolio of businesses they have built and they\u2019re all intertwined but.<\/span><br \/><span title=\"26:31 - 26:45\" data-start=\"00:26:31.335\" data-end=\"00:26:44.867\" data-spk=\"1\" data-label=\"Scot\">They have I imagine they have this is my mental model is they have dials where they can turn up and down this portfolio of businesses because they\u2019re all intertwined and that\u2019s one of the benefits of keeping this stuff together like when PayPal and eBay were together<\/span><br \/><span title=\"26:45 - 26:54\" data-start=\"00:26:44.831\" data-end=\"00:26:53.532\" data-spk=\"1\" data-label=\"Scot\">there are some operational Dynamics there that you could use to you know if you hit a certain speed bump or something you could navigate that better,<\/span><br \/><span title=\"26:54 - 27:02\" data-start=\"00:26:53.628\" data-end=\"00:27:01.878\" data-spk=\"1\" data-label=\"Scot\">so Amazon has these things so they\u2019ve got the core retail business which is lower margin it\u2019s a retail business still profitable on its own but.<\/span><\/p>\n<p><small>[27:02]<\/small>\u00a0<span title=\"27:02 - 27:15\" data-start=\"00:27:02.191\" data-end=\"00:27:14.702\" data-spk=\"1\" data-label=\"Scot\">Not a great business but a good business and but like a massive scale you know hundreds you know what three hundred million dollars plus annualized then you\u2019ve got a third party Marketplace business that we talk a lot about.<\/span><br \/><span title=\"27:15 - 27:17\" data-start=\"00:27:14.997\" data-end=\"00:27:16.817\" data-spk=\"1\" data-label=\"Scot\">Very profitable,<\/span><br \/><span title=\"27:17 - 27:29\" data-start=\"00:27:16.913\" data-end=\"00:27:28.877\" data-spk=\"1\" data-label=\"Scot\">doing really well you\u2019ve got a smaller ad business super profitable doing really well growing rapidly AWS the cloud component now merchant services which is essentially the monetization of the,<\/span><br \/><span title=\"27:29 - 27:32\" data-start=\"00:27:28.974\" data-end=\"00:27:32.260\" data-spk=\"1\" data-label=\"Scot\">Center asset you had to build for the first piece.<\/span><br \/><span title=\"27:32 - 27:45\" data-start=\"00:27:32.495\" data-end=\"00:27:44.777\" data-spk=\"1\" data-label=\"Scot\">And my mental model is what they basically said was well we\u2019re heading into this period where we\u2019ve got all these recessionary things consumers Under Pressure let\u2019s dial back on first party and dial-up third party.<\/span><br \/><span title=\"27:45 - 27:54\" data-start=\"00:27:45.000\" data-end=\"00:27:54.199\" data-spk=\"1\" data-label=\"Scot\">And that really won the day so so what they did is the third party as a percent they don\u2019t really give us.<\/span><br \/><span title=\"27:54 - 28:05\" data-start=\"00:27:54.404\" data-end=\"00:28:05.040\" data-spk=\"1\" data-label=\"Scot\">The gmv of each of these things that the total sales in each bucket they give you a unit mix so the unit mix was at an all-time high I need a fact check on this I\u2019m 99% sure this is right.<\/span><br \/><span title=\"28:05 - 28:13\" data-start=\"00:28:05.178\" data-end=\"00:28:12.905\" data-spk=\"1\" data-label=\"Scot\">Five 57% third party versus first party the highest previous that was last quarter at 55%.<\/span><br \/><span title=\"28:13 - 28:18\" data-start=\"00:28:13.272\" data-end=\"00:28:17.623\" data-spk=\"1\" data-label=\"Scot\">They may say let\u2019s 2% how could that really make that big a difference well.<\/span><\/p>\n<p><small>[28:18]<\/small>\u00a0<span title=\"28:18 - 28:31\" data-start=\"00:28:18.482\" data-end=\"00:28:30.825\" data-spk=\"1\" data-label=\"Scot\">That\u2019s actually big because when a hundred dollars moves from the first party bucket and you and I have talked about this a million times but just to recap for listeners in the first party bucket the accounting is a dollar is a dollar of Revenue.<\/span><br \/><span title=\"28:31 - 28:40\" data-start=\"00:28:31.228\" data-end=\"00:28:40.271\" data-spk=\"1\" data-label=\"Scot\">The third party Amazon doesn\u2019t get to recognize the hundred dollar widget that sold they only get to recognize their commission or take rate which is about 10%.<\/span><br \/><span title=\"28:41 - 28:46\" data-start=\"00:28:40.782\" data-end=\"00:28:46.220\" data-spk=\"1\" data-label=\"Scot\">So they lose 90 dollars if a doubt if a widget moves between those things and Revenue.<\/span><br \/><span title=\"28:47 - 28:59\" data-start=\"00:28:46.659\" data-end=\"00:28:58.671\" data-spk=\"1\" data-label=\"Scot\">But that ten dollars that\u2019s left is pure profit it\u2019s almost like 99% profit so so if you really want to you know juice profits you move things from the 1p bucket the 3p buck.<\/span><br \/><span title=\"28:59 - 29:05\" data-start=\"00:28:59.386\" data-end=\"00:29:04.505\" data-spk=\"1\" data-label=\"Scot\">So and then also tell us about Prime.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[29:06]<\/small>\u00a0<span title=\"29:06 - 29:13\" data-start=\"00:29:05.599\" data-end=\"00:29:12.546\" data-spk=\"0\" data-label=\"Jason\">Yeah so Prime is a little confusing this year because it was in July and historically that\u2019s<\/span><br \/><span title=\"29:12 - 29:43\" data-start=\"00:29:12.288\" data-end=\"00:29:43.114\" data-spk=\"0\" data-label=\"Jason\">when Prime day has always been except this weird covid era that we\u2019ve had so you know if you if you go back to 2020 they canceled Prime day in July and instead had it in October and then the following year in 2021 they went back to Summer but instead of having it in July I like they always have they had it earlier in June which is a big deal because it\u2019s a quarter earlier it\u2019s Q2 instead of Q3 so<\/span><br \/><span title=\"29:43 - 29:53\" data-start=\"00:29:42.862\" data-end=\"00:29:52.758\" data-spk=\"0\" data-label=\"Jason\">we\u2019re looking at Q2 this year we\u2019re competing against a cue to that had prime day in it and this year Prime day is in Q3 so this year<\/span><br \/><span title=\"29:53 - 29:57\" data-start=\"00:29:52.524\" data-end=\"00:29:57.067\" data-spk=\"0\" data-label=\"Jason\">Brenda is back to Mid July which July 12th and 13th so<\/span><br \/><span title=\"29:57 - 30:03\" data-start=\"00:29:56.881\" data-end=\"00:30:02.673\" data-spk=\"0\" data-label=\"Jason\">a lot of extra work and verbal gymnastics for the poor cf0 on the earnings calls.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[30:03]<\/small>\u00a0<span title=\"30:03 - 30:10\" data-start=\"00:30:02.583\" data-end=\"00:30:09.662\" data-spk=\"1\" data-label=\"Scot\">Yes there was no benefit from Prime in the quarter so that didn\u2019t really it neither hurt or helped.<\/span><br \/><span title=\"30:10 - 30:17\" data-start=\"00:30:09.915\" data-end=\"00:30:16.512\" data-spk=\"1\" data-label=\"Scot\">So even though third-party carried the day and I kind of theoretically so let\u2019s say.<\/span><br \/><span title=\"30:17 - 30:25\" data-start=\"00:30:16.681\" data-end=\"00:30:24.732\" data-spk=\"1\" data-label=\"Scot\">Yeah let\u2019s say you\u2019re running one of these really large retail businesses and you\u2019re either a store based or a e-commerce base<\/span><br \/><span title=\"30:25 - 30:30\" data-start=\"00:30:24.649\" data-end=\"00:30:29.978\" data-spk=\"1\" data-label=\"Scot\">I feel like Amazon because they have their products in a central location<\/span><br \/><span title=\"30:30 - 30:37\" data-start=\"00:30:29.883\" data-end=\"00:30:37.003\" data-spk=\"1\" data-label=\"Scot\">they can be much more dynamic because you know think of the store networks that Target and Walmart have almost like an edge Network.<\/span><\/p>\n<p><small>[30:37]<\/small>\u00a0<span title=\"30:37 - 30:45\" data-start=\"00:30:37.412\" data-end=\"00:30:44.791\" data-spk=\"1\" data-label=\"Scot\">And that product gets pushed out to the edge and then if you need to Pivot for some reason well you\u2019ve got a tough decision you can<\/span><br \/><span title=\"30:45 - 30:56\" data-start=\"00:30:44.653\" data-end=\"00:30:56.274\" data-spk=\"1\" data-label=\"Scot\">you can pull the product back it\u2019s not really desistance not really designed for that it\u2019s mostly returns comes back not like let me yank all the sweatshirts out of a you know store number 292 or something.<\/span><br \/><span title=\"30:57 - 31:05\" data-start=\"00:30:56.551\" data-end=\"00:31:04.789\" data-spk=\"1\" data-label=\"Scot\">Or you have to liquidate them and then you end up with this problem that you call so if your Edge is full of stuff that\u2019s not really moving right now,<\/span><br \/><span title=\"31:05 - 31:07\" data-start=\"00:31:04.801\" data-end=\"00:31:06.826\" data-spk=\"1\" data-label=\"Scot\">you can\u2019t really.<\/span><br \/><span title=\"31:07 - 31:22\" data-start=\"00:31:07.127\" data-end=\"00:31:21.524\" data-spk=\"1\" data-label=\"Scot\">Change that rapidly you know you\u2019ve got like a 60 90 day cycle to flush that out clear room for the stuff that\u2019s going to work so I think that even even though they did turn up these higher-margin pieces to win the day<\/span><br \/><span title=\"31:21 - 31:31\" data-start=\"00:31:21.435\" data-end=\"00:31:31.403\" data-spk=\"1\" data-label=\"Scot\">I think being an e-commerce oriented retailer gives them a lot more flexibility in a world where inventory and consumer behaviors are changing rapidly<\/span><br \/><span title=\"31:31 - 31:33\" data-start=\"00:31:31.398\" data-end=\"00:31:33.182\" data-spk=\"1\" data-label=\"Scot\">do you agree or disagree with that.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[31:34]<\/small>\u00a0<span title=\"31:34 - 31:48\" data-start=\"00:31:33.699\" data-end=\"00:31:48.313\" data-spk=\"0\" data-label=\"Jason\">Yeah no I I mean I feel like they\u2019re their breath of offerings and monetization make them much safer than most other retailers they have more levers to pull in more knobs to dial.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[31:49]<\/small>\u00a0<span title=\"31:49 - 32:02\" data-start=\"00:31:49.359\" data-end=\"00:32:01.677\" data-spk=\"1\" data-label=\"Scot\">And then the other thing and you know here one of the reasons I started spiffy is because we had talked so much on this show about the bifurcation where K seal Obama has come on and.<\/span><br \/><span title=\"32:02 - 32:10\" data-start=\"00:32:01.966\" data-end=\"00:32:09.573\" data-spk=\"1\" data-label=\"Scot\">Talked about the value and the consumer and the convenience or any consumer and a lot of that data came from 08-09 the quote-unquote Great Recession<\/span><br \/><span title=\"32:09 - 32:20\" data-start=\"00:32:09.489\" data-end=\"00:32:20.485\" data-spk=\"1\" data-label=\"Scot\">and you know what we learned during that recession is there is a consumer that is largely immune from recessionary and in that point time we didn\u2019t have inflation but I think I think that\u2019s kind of the same.<\/span><br \/><span title=\"32:21 - 32:30\" data-start=\"00:32:20.918\" data-end=\"00:32:29.667\" data-spk=\"1\" data-label=\"Scot\">Same kind of Stew if you will of macroeconomic stuff that the consumer has to face whereas the value are going to Consumer was really impacted by it.<\/span><br \/><span title=\"32:30 - 32:39\" data-start=\"00:32:30.070\" data-end=\"00:32:39.258\" data-spk=\"1\" data-label=\"Scot\">So I will also another argument I have is that that guy Josh on CNBC was wrong there is a separate customer now surely there\u2019s overlap and what not.<\/span><br \/><span title=\"32:39 - 32:43\" data-start=\"00:32:39.444\" data-end=\"00:32:42.557\" data-spk=\"1\" data-label=\"Scot\">But Amazon has captured all if not you know.<\/span><br \/><span title=\"32:43 - 32:56\" data-start=\"00:32:42.779\" data-end=\"00:32:56.095\" data-spk=\"1\" data-label=\"Scot\">98% of that convenience or any consumer and you know that is a great place to be when you have a lot of these recessionary wins because they\u2019re not as impacted as the value or any consumer.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[32:57]<\/small>\u00a0<span title=\"32:57 - 33:11\" data-start=\"00:32:56.871\" data-end=\"00:33:10.799\" data-spk=\"0\" data-label=\"Jason\">Yeah no I do I think you\u2019re 100% right like this gets complicated because these are such large numbers but the way I think of it there\u2019s 240 million households in the United States of America there is more than 100 million.<\/span><br \/><span title=\"33:11 - 33:19\" data-start=\"00:33:10.962\" data-end=\"00:33:19.440\" data-spk=\"0\" data-label=\"Jason\">Prime households right so the you know a significant chunk of America shop Amazon and have Prime,<\/span><br \/><span title=\"33:19 - 33:31\" data-start=\"00:33:19.477\" data-end=\"00:33:30.791\" data-spk=\"0\" data-label=\"Jason\">190 million households shop Walmart so basically all you know the vast majority of America except for rich people in New York and California shop Walmart so you can\u2019t talk about oh,<\/span><br \/><span title=\"33:31 - 33:37\" data-start=\"00:33:30.840\" data-end=\"00:33:37.077\" data-spk=\"0\" data-label=\"Jason\">there\u2019s a Walmart customer and there\u2019s an Amazon Customer because the vast majority of customers go to both places but.<\/span><\/p>\n<p><small>[33:38]<\/small>\u00a0<span title=\"33:38 - 33:50\" data-start=\"00:33:37.792\" data-end=\"00:33:49.984\" data-spk=\"0\" data-label=\"Jason\">There\u2019s a core customer that spends most of their money at these two places that is likely very different right so there\u2019s these these higher net worth individuals that spend the bulk of their discretionary money Amazon<\/span><br \/><span title=\"33:50 - 34:00\" data-start=\"00:33:49.871\" data-end=\"00:33:59.731\" data-spk=\"0\" data-label=\"Jason\">that are way more insulated from inflation than the average Walmart consumer that spends the bulk of their money there and then.<\/span><br \/><span title=\"34:00 - 34:10\" data-start=\"00:33:59.948\" data-end=\"00:34:09.802\" data-spk=\"0\" data-label=\"Jason\">A big difference in this inflationary period is if you\u2019re a cord customer that shops at Walmart or Target.<\/span><br \/><span title=\"34:10 - 34:21\" data-start=\"00:34:10.229\" data-end=\"00:34:21.322\" data-spk=\"0\" data-label=\"Jason\">You have more economic instability so you\u2019re spending more of your dollars on Essentials versus nice to haves right and guess where you get your Essentials Walmart and Target like that\u2019s still where you get your food.<\/span><br \/><span title=\"34:21 - 34:31\" data-start=\"00:34:21.478\" data-end=\"00:34:30.509\" data-spk=\"0\" data-label=\"Jason\">And so at Walmart the mix shifts right instead of buying a cool outfit you\u2019re buying more proteins for your family.<\/span><br \/><span title=\"34:31 - 34:41\" data-start=\"00:34:30.666\" data-end=\"00:34:41.061\" data-spk=\"0\" data-label=\"Jason\">But that that Amazon customer is both more affluent and therefore less impacted by by inflation and they probably don\u2019t get their protein from Amazon.<\/span><br \/><span title=\"34:41 - 34:50\" data-start=\"00:34:41.206\" data-end=\"00:34:49.835\" data-spk=\"0\" data-label=\"Jason\">Right so like we Amazon doesn\u2019t see their quote-unquote essential spending they only see their discretionary spending so they don\u2019t have the same.<\/span><br \/><span title=\"34:50 - 34:58\" data-start=\"00:34:50.045\" data-end=\"00:34:58.331\" data-spk=\"0\" data-label=\"Jason\">Dynamics like causing their mix to shift to less profitable mixes in a recession so I do think in that way.<\/span><br \/><span title=\"34:58 - 35:05\" data-start=\"00:34:58.482\" data-end=\"00:35:05.296\" data-spk=\"0\" data-label=\"Jason\">The economic headwinds facing Walmart and Target are very different than the ones facing Amazon.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[35:05]<\/small>\u00a0<span title=\"35:05 - 35:14\" data-start=\"00:35:05.224\" data-end=\"00:35:13.787\" data-spk=\"1\" data-label=\"Scot\">You know if you are getting your protein from Amazon it\u2019s probably at a Whole Foods where I have a feeling that consumers pretty resilient based on.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[35:13]<\/small>\u00a0<span title=\"35:13 - 35:23\" data-start=\"00:35:12.603\" data-end=\"00:35:22.981\" data-spk=\"0\" data-label=\"Jason\">Yeah which and again people do but like a see a statistically insignificant period of like whole food is less than 4% of the grocery market so yeah.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[35:23]<\/small>\u00a0<span title=\"35:23 - 35:27\" data-start=\"00:35:22.717\" data-end=\"00:35:27.181\" data-spk=\"1\" data-label=\"Scot\">Well our are like Kroger and those folks feeling I don\u2019t track them as.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[35:27]<\/small>\u00a0<span title=\"35:27 - 35:28\" data-start=\"00:35:27.079\" data-end=\"00:35:27.662\" data-spk=\"0\" data-label=\"Jason\">Yeah<\/span><br \/><span title=\"35:28 - 35:45\" data-start=\"00:35:27.542\" data-end=\"00:35:44.944\" data-spk=\"0\" data-label=\"Jason\">the so again they have less discretionary right so yeah they\u2019re they\u2019re doing pretty well like they\u2019re benefiting like a lot of the items in Kroger are impacted by inflation so there\u2019s their sales are up<\/span><br \/><span title=\"35:45 - 35:47\" data-start=\"00:35:44.788\" data-end=\"00:35:47.498\" data-spk=\"0\" data-label=\"Jason\">um the you know.<\/span><br \/><span title=\"35:48 - 36:02\" data-start=\"00:35:47.835\" data-end=\"00:36:02.004\" data-spk=\"0\" data-label=\"Jason\">They\u2019re like the discretionary retailers are losing more dollars to the grocer so it\u2019s I\u2019m not saying that that the grocer particularly love the current circumstances they\u2019re in but but they are like if you navigate them right there economically favorable.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[36:03]<\/small>\u00a0<span title=\"36:03 - 36:17\" data-start=\"00:36:02.671\" data-end=\"00:36:17.243\" data-spk=\"1\" data-label=\"Scot\">But then because it\u2019s not Walmart where interest or you\u2019re making the toys there\u2019s there\u2019s a loser somewhere and it\u2019s pie like a Macy\u2019s and JC Penney you\u2019re probably going to get hammered I would imagine because there\u2019s you know if Walmarts telling us people aren\u2019t buying much apparel than this kind of start Rippling through<\/span><br \/><span title=\"36:17 - 36:18\" data-start=\"00:36:17.159\" data-end=\"00:36:18.270\" data-spk=\"1\" data-label=\"Scot\">all these other places.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[36:18]<\/small>\u00a0<span title=\"36:18 - 36:21\" data-start=\"00:36:17.970\" data-end=\"00:36:21.143\" data-spk=\"0\" data-label=\"Jason\">Yeah or I\u2019ll give you an even more painful example Bed Bath &amp; Beyond.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[36:22]<\/small>\u00a0<span title=\"36:22 - 36:24\" data-start=\"00:36:21.528\" data-end=\"00:36:23.672\" data-spk=\"1\" data-label=\"Scot\">Yeah yes Father they\u2019re not doing well.<\/span><br \/><span title=\"36:25 - 36:37\" data-start=\"00:36:24.863\" data-end=\"00:36:37.283\" data-spk=\"1\" data-label=\"Scot\">Okay let\u2019s peel the onion on this a little bit so Revenue grew 7.2 percent year-over-year to 120 1.2 billion and that exceeded the expectations of 119 billion by about 2 billion.<\/span><br \/><span title=\"36:38 - 36:46\" data-start=\"00:36:37.674\" data-end=\"00:36:45.509\" data-spk=\"1\" data-label=\"Scot\">So not a huge huge beat but again it was such a bad setup that that it seemed like.<\/span><br \/><span title=\"36:46 - 37:00\" data-start=\"00:36:45.834\" data-end=\"00:37:00.478\" data-spk=\"1\" data-label=\"Scot\">You know what a miracle in somewhere North America this is really interesting when you kind of look inside of Revenue North America came in at 74 billion and then expectation was sixty seven billion so that was a really that was almost like a 10% Len.<\/span><br \/><span title=\"37:01 - 37:07\" data-start=\"00:37:00.695\" data-end=\"00:37:07.190\" data-spk=\"1\" data-label=\"Scot\">But then International was a miss it was 27 verses 32 billion.<\/span><br \/><span title=\"37:07 - 37:20\" data-start=\"00:37:07.395\" data-end=\"00:37:19.737\" data-spk=\"1\" data-label=\"Scot\">Everything I forgot to say that the top and everything we do is outside of the impact of financial currency moves so it\u2019s called X FX and Wall Street parlance which which is important because the,<\/span><br \/><span title=\"37:20 - 37:29\" data-start=\"00:37:19.870\" data-end=\"00:37:28.781\" data-spk=\"1\" data-label=\"Scot\">currency moves are gyrating around like crazy right now so you swirl that together and that\u2019s where you get your North America was up seven,<\/span><br \/><span title=\"37:29 - 37:42\" data-start=\"00:37:28.781\" data-end=\"00:37:42.301\" data-spk=\"1\" data-label=\"Scot\">International is all five so that\u2019s how you get your two billion dollar win but it\u2019s really interesting because if you look at Amazon\u2019s North America they were up 14 percent year-over-year which Compares very favorably to your US Department of Commerce data.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[37:44]<\/small>\u00a0<span title=\"37:44 - 37:49\" data-start=\"00:37:44.002\" data-end=\"00:37:48.659\" data-spk=\"0\" data-label=\"Jason\">Yeah yeah no that\u2019s a and again like,<\/span><br \/><span title=\"37:49 - 38:02\" data-start=\"00:37:48.671\" data-end=\"00:38:02.473\" data-spk=\"0\" data-label=\"Jason\">I look at this all in Aggregate and say this is a solid quarter in a challenging climate for Amazon and yeah they have performed the the industry average despite<\/span><br \/><span title=\"38:02 - 38:04\" data-start=\"00:38:02.276\" data-end=\"00:38:04.096\" data-spk=\"0\" data-label=\"Jason\">being one of the largest players.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[38:04]<\/small>\u00a0<span title=\"38:04 - 38:19\" data-start=\"00:38:03.850\" data-end=\"00:38:18.656\" data-spk=\"1\" data-label=\"Scot\">Yeah and then you know a mere like less than a week after Walmart said they were going from kind of ten percent to one percent profit margin Amazon\u2019s gross margins improved 45 percent year over year versus the consensus 43 percent so that,<\/span><br \/><span title=\"38:19 - 38:28\" data-start=\"00:38:18.674\" data-end=\"00:38:28.487\" data-spk=\"1\" data-label=\"Scot\">that was the one that really yeah I think people are like well if they make revenues surely they\u2019re going to go out and readjust their profits and it\u2019s going to be really hard so<\/span><br \/><span title=\"38:28 - 38:40\" data-start=\"00:38:28.397\" data-end=\"00:38:39.634\" data-spk=\"1\" data-label=\"Scot\">they came in with an operating income of 3.3 billion and this was in our Sunday called out an incremental for billion of increased cost but that was offset from improved fulfillment center Ops<\/span><br \/><span title=\"38:40 - 38:49\" data-start=\"00:38:39.544\" data-end=\"00:38:49.116\" data-spk=\"1\" data-label=\"Scot\">so I think what\u2019s going on is they built out the Fulfillment center capacity so crazily and they\u2019ll since the pandemic they were basically just standing them up and just you know<\/span><br \/><span title=\"38:49 - 38:51\" data-start=\"00:38:49.074\" data-end=\"00:38:50.955\" data-spk=\"1\" data-label=\"Scot\">getting stuff out as quickly as possible.<\/span><\/p>\n<p><small>[38:51]<\/small>\u00a0<span title=\"38:51 - 39:03\" data-start=\"00:38:51.490\" data-end=\"00:39:03.496\" data-spk=\"1\" data-label=\"Scot\">And then this quarter they kind of came back and where they use this phraseology invest in Harvest so they go in these different modes so they\u2019re able to come out of invest mode and look around and say well.<\/span><br \/><span title=\"39:04 - 39:11\" data-start=\"00:39:03.712\" data-end=\"00:39:10.700\" data-spk=\"1\" data-label=\"Scot\">You know in 2020 we sure we\u2019re setting up fulfillment centers kind of crazily lets you know we need to tweak,<\/span><br \/><span title=\"39:11 - 39:22\" data-start=\"00:39:10.725\" data-end=\"00:39:21.757\" data-spk=\"1\" data-label=\"Scot\">this this and this and then I want to have billion dollars of operational efficiency came out of that they called out some areas that are increasing and expense are.<\/span><br \/><span title=\"39:22 - 39:36\" data-start=\"00:39:22.082\" data-end=\"00:39:35.524\" data-spk=\"1\" data-label=\"Scot\">Ews expenses so those sit there and use a lot of electricity which a lot of electricity is off fossil fuels and then I think I think computers are getting more expensive I guess that must be a chip related thing you said Electronics but that\u2019s<\/span><br \/><span title=\"39:35 - 39:38\" data-start=\"00:39:35.458\" data-end=\"00:39:37.777\" data-spk=\"1\" data-label=\"Scot\">probably like big screen TVs anyway.<\/span><br \/><span title=\"39:38 - 39:46\" data-start=\"00:39:38.168\" data-end=\"00:39:46.070\" data-spk=\"1\" data-label=\"Scot\">Then obviously they called out fuel as an area and then they have a particularly large amount of money going into digital.<\/span><br \/><span title=\"39:46 - 39:57\" data-start=\"00:39:46.239\" data-end=\"00:39:56.724\" data-spk=\"1\" data-label=\"Scot\">With the funding with digital content with the funding of The Lord of the Rings series coming out and then they also bought Thursday Night Football so they called those out is as expense items.<\/span><br \/><span title=\"39:57 - 40:00\" data-start=\"00:39:57.163\" data-end=\"00:40:00.468\" data-spk=\"1\" data-label=\"Scot\">And as I mentioned at the top third-party one today.<\/span><br \/><span title=\"40:01 - 40:11\" data-start=\"00:40:00.648\" data-end=\"00:40:10.989\" data-spk=\"1\" data-label=\"Scot\">And then looking inside of there we talked about that seller Services grew nine point one percent year over year to twenty seven point four billion and I think whenever any of these things,<\/span><br \/><span title=\"40:11 - 40:20\" data-start=\"00:40:11.050\" data-end=\"00:40:19.594\" data-spk=\"1\" data-label=\"Scot\">grow faster than the Baseline of 7% and they\u2019re higher-margin they\u2019re going to drop that much more dollars to the bottom line.<\/span><\/p>\n<p><small>[40:20]<\/small>\u00a0<span title=\"40:20 - 40:27\" data-start=\"00:40:20.274\" data-end=\"00:40:27.010\" data-spk=\"1\" data-label=\"Scot\">So there was that and then I don\u2019t know anything about ads so I\u2019ll kick that one over to you.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[40:27]<\/small>\u00a0<span title=\"40:27 - 40:34\" data-start=\"00:40:26.710\" data-end=\"00:40:33.950\" data-spk=\"0\" data-label=\"Jason\">Yeah speaking of things that drop Towers to the bottom line so that the ad units is a reminder is a.<\/span><br \/><span title=\"40:34 - 40:49\" data-start=\"00:40:34.125\" data-end=\"00:40:48.612\" data-spk=\"0\" data-label=\"Jason\">This business Amazon has had for a while but only broke out as a separate segment recently and so now it\u2019s fun to see it every quarter so it Q2 of 2022 was up 21% versus,<\/span><br \/><span title=\"40:49 - 40:52\" data-start=\"00:40:48.727\" data-end=\"00:40:51.809\" data-spk=\"0\" data-label=\"Jason\">the second quarter last year,<\/span><br \/><span title=\"40:52 - 41:05\" data-start=\"00:40:51.876\" data-end=\"00:41:05.456\" data-spk=\"0\" data-label=\"Jason\">um if you add up the last four quarters of Ed Revenue its thirty four billion dollars in ads than Amazon selling and Amazon doesn\u2019t tell us the profitability of these individual segments but most people estimate that like.<\/span><\/p>\n<p><small>[41:06]<\/small>\u00a0<span title=\"41:06 - 41:12\" data-start=\"00:41:06.045\" data-end=\"00:41:11.561\" data-spk=\"0\" data-label=\"Jason\">Worst the advertising business is probably a 75% gross margin business so,<\/span><br \/><span title=\"41:12 - 41:21\" data-start=\"00:41:11.639\" data-end=\"00:41:20.556\" data-spk=\"0\" data-label=\"Jason\">75% gross margins on thirty four billion dollars makes the ad business more profitable than AWS for Amazon so,<\/span><br \/><span title=\"41:21 - 41:28\" data-start=\"00:41:20.683\" data-end=\"00:41:28.398\" data-spk=\"0\" data-label=\"Jason\">um Healthy Growth again you think about all the other people selling ads Google Facebook snap,<\/span><br \/><span title=\"41:28 - 41:39\" data-start=\"00:41:28.489\" data-end=\"00:41:38.758\" data-spk=\"0\" data-label=\"Jason\">um you know really struggling but Amazon you know continues to grow and they\u2019re already the third largest advertising Network in the US so,<\/span><br \/><span title=\"41:39 - 41:40\" data-start=\"00:41:38.800\" data-end=\"00:41:40.206\" data-spk=\"0\" data-label=\"Jason\">that\u2019s pretty impressive,<\/span><br \/><span title=\"41:40 - 41:52\" data-start=\"00:41:40.225\" data-end=\"00:41:51.707\" data-spk=\"0\" data-label=\"Jason\">side note you know every other retailer in the world is trying to replicate this this new ad business than Amazon has invented and they\u2019re all doing it you know with great success at a much smaller scale.<\/span><br \/><span title=\"41:52 - 41:58\" data-start=\"00:41:51.984\" data-end=\"00:41:57.662\" data-spk=\"0\" data-label=\"Jason\">Um so that you know the ad dollars are shifting from these,<\/span><br \/><span title=\"41:58 - 42:06\" data-start=\"00:41:57.753\" data-end=\"00:42:06.442\" data-spk=\"0\" data-label=\"Jason\">kind of top of funnel content providers to these bottom of the funnel retail networks that have first-party data and don\u2019t have all these idea of a.<\/span><br \/><span title=\"42:07 - 42:10\" data-start=\"00:42:06.622\" data-end=\"00:42:09.813\" data-spk=\"0\" data-label=\"Jason\">Problems that the others are facing so that\u2019s.<\/span><\/p>\n<p><small>[42:10]<\/small>\u00a0<span title=\"42:10 - 42:19\" data-start=\"00:42:10.216\" data-end=\"00:42:19.361\" data-spk=\"0\" data-label=\"Jason\">The ad business you know separately Amazon Amazon has this subscription business which is mostly Prime but a few other things mixed in there and,<\/span><br \/><span title=\"42:19 - 42:30\" data-start=\"00:42:19.452\" data-end=\"00:42:30.322\" data-spk=\"0\" data-label=\"Jason\">you would expect that to be slowing down because they\u2019ve you know hit they\u2019ve saturated they probably have half of us households have Prime accounts but that\u2019s still growing at 14% which again.<\/span><\/p>\n<p><small>[42:31]<\/small>\u00a0<span title=\"42:31 - 42:40\" data-start=\"00:42:30.605\" data-end=\"00:42:40.495\" data-spk=\"0\" data-label=\"Jason\">Is pretty impressive and I think that\u2019s a picking up the rate of growth from last quarter so it\u2019s super interesting impressive to me that these,<\/span><br \/><span title=\"42:41 - 42:50\" data-start=\"00:42:40.592\" data-end=\"00:42:49.929\" data-spk=\"0\" data-label=\"Jason\">these plati sticky Echo systems are particularly strong and Amazon and then of course everyone always talks about AWS,<\/span><br \/><span title=\"42:50 - 43:04\" data-start=\"00:42:50.008\" data-end=\"00:43:04.189\" data-spk=\"0\" data-label=\"Jason\">you know I get and we\u2019ll talk about this later but we get all these annoying tweets that like oh the only profitable part of Amazon is a WS and it\u2019s great it is great right and revenue there was almost 20 billion dollars in nineteen point seven billion,<\/span><br \/><span title=\"43:04 - 43:13\" data-start=\"00:43:04.207\" data-end=\"00:43:13.010\" data-spk=\"0\" data-label=\"Jason\">which is well ahead of the confessed consensus estimates it\u2019s a decent margin business so I think there is a lot of hardware and electronic electricity,<\/span><br \/><span title=\"43:13 - 43:22\" data-start=\"00:43:13.047\" data-end=\"00:43:22.228\" data-spk=\"0\" data-label=\"Jason\">behind that business but it\u2019s still pretty high margins and you know a lot of the world hasn\u2019t moved to the crowd yet so it WS has a lot of,<\/span><br \/><span title=\"43:22 - 43:24\" data-start=\"00:43:22.337\" data-end=\"00:43:24.193\" data-spk=\"0\" data-label=\"Jason\">Headroom in its Tam<\/span><br \/><span title=\"43:24 - 43:36\" data-start=\"00:43:24.175\" data-end=\"00:43:36.055\" data-spk=\"0\" data-label=\"Jason\">but a lot of folks were worried that in these economic uncertainty times that I see shops would be slowing down their migration in the cloud and therefore AWS would,<\/span><br \/><span title=\"43:36 - 43:49\" data-start=\"00:43:36.061\" data-end=\"00:43:49.383\" data-spk=\"0\" data-label=\"Jason\">would take a hit and I want to say Microsoft announced a slower rate of growth before Amazon so there was an expectation there that might not be an awesome number and and again it was pretty solid<\/span><br \/><span title=\"43:49 - 43:52\" data-start=\"00:43:49.245\" data-end=\"00:43:51.673\" data-spk=\"0\" data-label=\"Jason\">solid beat for for AWS.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[43:52]<\/small>\u00a0<span title=\"43:52 - 43:57\" data-start=\"00:43:51.991\" data-end=\"00:43:57.111\" data-spk=\"1\" data-label=\"Scot\">Yeah so that\u2019s kind of the different operating units and then,<\/span><br \/><span title=\"43:57 - 44:05\" data-start=\"00:43:57.147\" data-end=\"00:44:05.073\" data-spk=\"1\" data-label=\"Scot\">you know again wall Street\u2019s kind of a what have you done for me lately so then everyone\u2019s like well this is an anomaly surely surely you\u2019re not going to be able to repeat this<\/span><br \/><span title=\"44:05 - 44:18\" data-start=\"00:44:04.923\" data-end=\"00:44:17.794\" data-spk=\"1\" data-label=\"Scot\">and everyone said number one stop calling me Shirley and then number two Amazon put out Q3 guidance and basically both the revenue of that guidance and the prophet were well ahead of what Wall Street had been thinking.<\/span><br \/><span title=\"44:18 - 44:28\" data-start=\"00:44:17.999\" data-end=\"00:44:27.739\" data-spk=\"1\" data-label=\"Scot\">The the revenue guidance was 125 to 130 billion which at the midpoint is 15 percent growth so are one was was quite<\/span><br \/><span title=\"44:28 - 44:35\" data-start=\"00:44:27.625\" data-end=\"00:44:34.950\" data-spk=\"1\" data-label=\"Scot\">pleased by that it basically made it feel like they were feeling very strong because remember<\/span><br \/><span title=\"44:35 - 44:47\" data-start=\"00:44:34.932\" data-end=\"00:44:47.172\" data-spk=\"1\" data-label=\"Scot\">this is all 727 so Amazon\u2019s got 27 date they got about a third of the quarter already in the books and it basically was a signal Amazon saying yeah we feel pretty good about the quarter right now<\/span><br \/><span title=\"44:47 - 44:53\" data-start=\"00:44:47.053\" data-end=\"00:44:53.362\" data-spk=\"1\" data-label=\"Scot\">and Amazon had prime day in the books as well so that was good and then.<\/span><\/p>\n<p><small>[44:54]<\/small>\u00a0<span title=\"44:54 - 45:01\" data-start=\"00:44:53.813\" data-end=\"00:45:00.681\" data-spk=\"1\" data-label=\"Scot\">Do anything Wall Street loves more than a beat and then raised so the beat is current quarter and then the Rays was the going forward quarter<\/span><br \/><span title=\"45:01 - 45:08\" data-start=\"00:45:00.543\" data-end=\"00:45:08.372\" data-spk=\"1\" data-label=\"Scot\">is Abby trays in a buyback so then they also said oh and by the way we bought 3.3 billion dollars worth of stock in the quarter because we felt like<\/span><br \/><span title=\"45:08 - 45:18\" data-start=\"00:45:08.247\" data-end=\"00:45:17.807\" data-spk=\"1\" data-label=\"Scot\">the price the stock was was kind of left so so that was all very very well received and and really made Amazon stand out from from<\/span><br \/><span title=\"45:18 - 45:25\" data-start=\"00:45:17.705\" data-end=\"00:45:25.396\" data-spk=\"1\" data-label=\"Scot\">me up substantially from the other both retailers and add companies that had previously reported.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[45:27]<\/small>\u00a0<span title=\"45:27 - 45:28\" data-start=\"00:45:27.121\" data-end=\"00:45:28.395\" data-spk=\"0\" data-label=\"Jason\">Yeah so.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[45:28]<\/small>\u00a0<span title=\"45:28 - 45:30\" data-start=\"00:45:28.095\" data-end=\"00:45:29.656\" data-spk=\"1\" data-label=\"Scot\">And then you got Mean Tweets go.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[45:30]<\/small>\u00a0<span title=\"45:30 - 45:42\" data-start=\"00:45:29.525\" data-end=\"00:45:42.300\" data-spk=\"0\" data-label=\"Jason\">Yeah so here\u2019s what\u2019s annoying so I would say that that\u2019s a terrific quarter for Amazon given the economic climate and you know frankly exceeded my expectations and in a number of areas.<\/span><br \/><span title=\"45:43 - 45:56\" data-start=\"00:45:42.594\" data-end=\"00:45:55.622\" data-spk=\"0\" data-label=\"Jason\">But you do know there\u2019s room for lots of different interpretation and a bunch of folks on Twitter like zoomed in on the profitability of the US retail sector was down and you know they jump on this whole like<\/span><br \/><span title=\"45:56 - 46:01\" data-start=\"00:45:55.556\" data-end=\"00:46:01.264\" data-spk=\"0\" data-label=\"Jason\">see this is what we\u2019ve always been saying retails unprofitable it\u2019s a loss leader for Amazon,<\/span><br \/><span title=\"46:01 - 46:10\" data-start=\"00:46:01.283\" data-end=\"00:46:09.923\" data-spk=\"0\" data-label=\"Jason\">you know really Amazon is just about a WS and this like you know Silly retail thing is just a sideshow and there\u2019s no way to make money on it.<\/span><br \/><span title=\"46:10 - 46:18\" data-start=\"00:46:10.128\" data-end=\"00:46:18.090\" data-spk=\"0\" data-label=\"Jason\">How do they get away with a lot sweeter thing Jason don\u2019t I have that right like I got a bunch of tweets like that and I didn\u2019t respond because.<\/span><br \/><span title=\"46:20 - 46:26\" data-start=\"00:46:19.670\" data-end=\"00:46:26.484\" data-spk=\"0\" data-label=\"Jason\">I\u2019m not articulate enough to answer in a short tweet so hopefully it will make everyone listen to this this whole podcast,<\/span><br \/><span title=\"46:27 - 46:41\" data-start=\"00:46:26.617\" data-end=\"00:46:41.249\" data-spk=\"0\" data-label=\"Jason\">but I would say you guys are all wow like it was a terrific quarter for Amazon retail like and there\u2019s two things you\u2019re missing Gap profit is not the same thing as how many dollars flow to your bank account right like,<\/span><br \/><span title=\"46:41 - 46:51\" data-start=\"00:46:41.351\" data-end=\"00:46:50.605\" data-spk=\"0\" data-label=\"Jason\">um you know how much money Amazon decides to invest in new warehouses that are going to pay off in the future dramatically affects their.<\/span><\/p>\n<p><small>[46:51]<\/small>\u00a0<span title=\"46:51 - 47:00\" data-start=\"00:46:50.839\" data-end=\"00:46:59.865\" data-spk=\"0\" data-label=\"Jason\">And so it\u2019s almost silly to look at Gap profit to say whether Amazon retailers a good business or not but more importantly.<\/span><br \/><span title=\"47:00 - 47:10\" data-start=\"00:47:00.009\" data-end=\"00:47:09.768\" data-spk=\"0\" data-label=\"Jason\">Um all these profitable businesses that everyone\u2019s talking about exist only because of retail right so that ad business I just talked about.<\/span><\/p>\n<p><small>[47:10]<\/small>\u00a0<span title=\"47:10 - 47:16\" data-start=\"00:47:09.936\" data-end=\"00:47:15.909\" data-spk=\"0\" data-label=\"Jason\">People aren\u2019t coming to Amazon to consume ads they\u2019re coming to Amazon to buy stuff in the ad show up right,<\/span><br \/><span title=\"47:16 - 47:23\" data-start=\"00:47:15.999\" data-end=\"00:47:23.450\" data-spk=\"0\" data-label=\"Jason\">um and the other business that\u2019s impossible for Amazon to lose money on that\u2019s growing wildly is merchant services that you hit on,<\/span><br \/><span title=\"47:24 - 47:37\" data-start=\"00:47:23.553\" data-end=\"00:47:37.307\" data-spk=\"0\" data-label=\"Jason\">um the merchant services are because Merchants want to sell stuff on Amazon on the retail platform and so it\u2019s a little when people are talking about oh gosh the retail business and Amazon\u2019s a loser but the ad business is profitable,<\/span><br \/><span title=\"47:37 - 47:39\" data-start=\"00:47:37.332\" data-end=\"00:47:39.050\" data-spk=\"0\" data-label=\"Jason\">that\u2019s a little bit like saying.<\/span><br \/><span title=\"47:39 - 47:51\" data-start=\"00:47:39.212\" data-end=\"00:47:50.816\" data-spk=\"0\" data-label=\"Jason\">The content creation business in b.c. is a total loser but the ad business at MBC is a winner right like know that they\u2019re only able to sell ads because they create that content and in the same way.<\/span><br \/><span title=\"47:51 - 48:00\" data-start=\"00:47:50.978\" data-end=\"00:47:59.595\" data-spk=\"0\" data-label=\"Jason\">Amazon is only able to make money on Merchant Services and ads and to some extent on subscriptions because of this,<\/span><br \/><span title=\"48:00 - 48:03\" data-start=\"00:47:59.727\" data-end=\"00:48:02.593\" data-spk=\"0\" data-label=\"Jason\">vibrant strong retail business<\/span><br \/><span title=\"48:03 - 48:15\" data-start=\"00:48:02.546\" data-end=\"00:48:15.110\" data-spk=\"0\" data-label=\"Jason\">um that you know has more favorable characteristics than a lot of other big retailers in this current inflationary potentially recessionary environment so I\u2019m sorry guys I just I think<\/span><br \/><span title=\"48:15 - 48:22\" data-start=\"00:48:15.039\" data-end=\"00:48:21.894\" data-spk=\"0\" data-label=\"Jason\">you\u2019re wrong and wildly oversimplifying Amazon\u2019s business model and economic circumstances.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[48:22]<\/small>\u00a0<span title=\"48:22 - 48:30\" data-start=\"00:48:22.165\" data-end=\"00:48:30.151\" data-spk=\"1\" data-label=\"Scot\">Yet another framing that\u2019s kind of fun is after retails been around for what like I guess even longer but I get<\/span><br \/><span title=\"48:30 - 48:34\" data-start=\"00:48:30.091\" data-end=\"00:48:33.666\" data-spk=\"1\" data-label=\"Scot\">I was here Sears like 150 years or something.<\/span><br \/><span title=\"48:34 - 48:44\" data-start=\"00:48:33.835\" data-end=\"00:48:44.104\" data-spk=\"1\" data-label=\"Scot\">And you have all that history and it took Jeff Bezos to figure out hey you can actually glom on these really profitable high margin businesses and make the whole thing better<\/span><br \/><span title=\"48:44 - 48:56\" data-start=\"00:48:43.978\" data-end=\"00:48:56.092\" data-spk=\"1\" data-label=\"Scot\">and there\u2019s a synergy synergy inside of there that enables you to like they did this quarter where they can dial things up and down don\u2019t you think Walmart had more of that right now or Target or you know<\/span><br \/><span title=\"48:56 - 49:06\" data-start=\"00:48:55.948\" data-end=\"00:49:05.532\" data-spk=\"1\" data-label=\"Scot\">Macy\u2019s or any of these other retailers so so in a way I think they\u2019re missing the point there to just pick out this one piece that can\u2019t be<\/span><br \/><span title=\"49:06 - 49:15\" data-start=\"00:49:05.521\" data-end=\"00:49:15.201\" data-spk=\"1\" data-label=\"Scot\">unintegrated and say that it\u2019s doing bad because you have to take the whole enchilada because they designed you know retail 2.0,<\/span><br \/><span title=\"49:15 - 49:19\" data-start=\"00:49:15.243\" data-end=\"00:49:19.161\" data-spk=\"1\" data-label=\"Scot\">by mixing all these things together in a unique way no one figured out till they did.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[49:21]<\/small>\u00a0<span title=\"49:21 - 49:28\" data-start=\"00:49:20.736\" data-end=\"00:49:27.525\" data-spk=\"0\" data-label=\"Jason\">Yeah no hundred percent so so Props to Amazon and keep on keeping on.<\/span><br \/><span title=\"49:28 - 49:40\" data-start=\"00:49:28.265\" data-end=\"00:49:40.259\" data-spk=\"0\" data-label=\"Jason\">I did want to I think we\u2019re over on time but I just wanted to just like briefly hit on a couple non earnings related topics just to wet people\u2019s whistle so.<\/span><br \/><span title=\"49:41 - 49:51\" data-start=\"00:49:40.626\" data-end=\"00:49:51.394\" data-spk=\"0\" data-label=\"Jason\">Hey we talked about prime day there\u2019s a pretty significant week that there\u2019s going to be a second prime Day this year so a lot so a number of journalists have seen internal documents.<\/span><br \/><span title=\"49:52 - 49:57\" data-start=\"00:49:51.532\" data-end=\"00:49:56.970\" data-spk=\"0\" data-label=\"Jason\">That talked about a thing called Prime Early Access sale which is scheduled to happen this fall.<\/span><br \/><span title=\"49:57 - 50:06\" data-start=\"00:49:57.121\" data-end=\"00:50:06.242\" data-spk=\"0\" data-label=\"Jason\">And so most of us interpret that as likely going to be October which again is when they accidentally had Prime in 2020 because of covid-19.<\/span><br \/><span title=\"50:06 - 50:15\" data-start=\"00:50:06.477\" data-end=\"00:50:14.895\" data-spk=\"0\" data-label=\"Jason\">So look for more there but like potentially Amazon will have a second prime day to me that\u2019s really interesting because.<\/span><br \/><span title=\"50:15 - 50:25\" data-start=\"00:50:15.166\" data-end=\"00:50:25.303\" data-spk=\"0\" data-label=\"Jason\">I feel like the first Prime day at this point is mostly about comps and people turn to match last year\u2019s Prime day and it\u2019s I\u2019m not sure it\u2019s necessarily totally additive but adding a new sail if it.<\/span><\/p>\n<p><small>[50:26]<\/small>\u00a0<span title=\"50:26 - 50:31\" data-start=\"00:50:25.712\" data-end=\"00:50:31.456\" data-spk=\"0\" data-label=\"Jason\">Works and capture sales in October that could be interesting so.<\/span><br \/><span title=\"50:32 - 50:46\" data-start=\"00:50:31.733\" data-end=\"00:50:45.517\" data-spk=\"0\" data-label=\"Jason\">I found that super interesting Amazon launched a new product that maybe is only cool to me but it\u2019s called retail store analytics and this is they\u2019re taking all the data from all the cameras and all the just walk out stores and they\u2019re selling it back to the brands.<\/span><br \/><span title=\"50:46 - 50:56\" data-start=\"00:50:45.824\" data-end=\"00:50:55.576\" data-spk=\"0\" data-label=\"Jason\">So you know just like a you know a cpg can go to Amazon and find out how many glances they got on their their product detail page and how many add to carts they got,<\/span><br \/><span title=\"50:56 - 51:01\" data-start=\"00:50:55.631\" data-end=\"00:51:01.165\" data-spk=\"0\" data-label=\"Jason\">they can now find out in a Whole Foods how many people looked at their package on the Shelf versus how many people bought it so there,<\/span><br \/><span title=\"51:01 - 51:09\" data-start=\"00:51:01.267\" data-end=\"00:51:08.893\" data-spk=\"0\" data-label=\"Jason\">they\u2019re monetizing all the customer insights they\u2019re getting from these brick-and-mortar stores using all those cameras which I thought was pretty cool.<\/span><br \/><span title=\"51:09 - 51:23\" data-start=\"00:51:09.097\" data-end=\"00:51:22.972\" data-spk=\"0\" data-label=\"Jason\">And then the last thing I\u2019ll leave people with is there were some significant articles talking about internal week memos about Amazon trimming its private label and its private label largely being.<\/span><br \/><span title=\"51:23 - 51:28\" data-start=\"00:51:23.134\" data-end=\"00:51:28.392\" data-spk=\"0\" data-label=\"Jason\">Unsuccessful and Amazon potentially moving away from private label and.<\/span><br \/><span title=\"51:29 - 51:34\" data-start=\"00:51:28.645\" data-end=\"00:51:34.299\" data-spk=\"0\" data-label=\"Jason\">Like I don\u2019t think those articles are wrong but I would just throw 11 piece of caution when you interpret those articles.<\/span><\/p>\n<p><small>[51:35]<\/small>\u00a0<span title=\"51:35 - 51:41\" data-start=\"00:51:34.774\" data-end=\"00:51:40.602\" data-spk=\"0\" data-label=\"Jason\">I\u2019ve seen no evidence that Amazon\u2019s moving away from any of its successful private-label initiatives,<\/span><br \/><span title=\"51:41 - 51:55\" data-start=\"00:51:40.735\" data-end=\"00:51:54.664\" data-spk=\"0\" data-label=\"Jason\">so so what\u2019s happening Amazon has a huge amount of private labels they have a ton of Brands they invented a bunch of them never got traction never caught on never had significant sales and I do think they\u2019re doing a rationalization of all of those,<\/span><br \/><span title=\"51:55 - 52:00\" data-start=\"00:51:54.742\" data-end=\"00:52:00.198\" data-spk=\"0\" data-label=\"Jason\">but there still are Amazon private label brands,<\/span><br \/><span title=\"52:00 - 52:13\" data-start=\"00:52:00.258\" data-end=\"00:52:13.051\" data-spk=\"0\" data-label=\"Jason\">they\u2019re doing quite well and it appears the Amazon is doubling down on those so I guess what I would say is that they\u2019re really focused on the head tail private labeled it\u2019s doing well in there,<\/span><br \/><span title=\"52:13 - 52:22\" data-start=\"00:52:13.088\" data-end=\"00:52:22.257\" data-spk=\"0\" data-label=\"Jason\">they\u2019re kind of rationalizing the long tail that was not doing well so that is all of the Amazon news,<\/span><br \/><span title=\"52:22 - 52:33\" data-start=\"00:52:22.378\" data-end=\"00:52:33.422\" data-spk=\"0\" data-label=\"Jason\">and it\u2019s a good thing because we\u2019ve blown through our lot of time once again as always if you found this episode valuable we sure would appreciate that five star review on iTunes.<\/span><\/p>\n<p><b data-spk=\"1\">Scot:<\/b><br \/><small>[52:33]<\/small>\u00a0<span title=\"52:33 - 52:36\" data-start=\"00:52:33.495\" data-end=\"00:52:36.276\" data-spk=\"1\" data-label=\"Scot\">Thanks everyone and until next time.<\/span><\/p>\n<p><b data-spk=\"0\">Jason:<\/b><br \/><small>[52:37]<\/small>\u00a0<span title=\"52:37 - 52:39\" data-start=\"00:52:36.595\" data-end=\"00:52:38.650\" data-spk=\"0\" data-label=\"Jason\">Happy commercing!<\/span><\/p>\n<\/div>\n<p><p><a href=\"https:\/\/dmsretail.com\/online-workshops-list\/\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-496\" src=\"https:\/\/dmsretail.com\/RetailNews\/wp-content\/uploads\/2022\/05\/RETAIL-ONLINE-TRAINING-728-X-90.png\" alt=\"Retail Online Training\" width=\"729\" height=\"91\" srcset=\"https:\/\/dmsretail.com\/RetailNews\/wp-content\/uploads\/2022\/05\/RETAIL-ONLINE-TRAINING-728-X-90.png 729w, https:\/\/dmsretail.com\/RetailNews\/wp-content\/uploads\/2022\/05\/RETAIL-ONLINE-TRAINING-728-X-90-300x37.png 300w\" sizes=\"auto, (max-width: 729px) 100vw, 729px\" \/><\/a><\/p><br \/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A weekly podcast with the latest e-commerce news and events. Episode 294 is a recap of Amazon\u2019s earnings for Q2 2022. Subscribe: ????? Episode 294 [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":1121,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[],"class_list":["post-8184","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-podcasts"],"_links":{"self":[{"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/posts\/8184","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/comments?post=8184"}],"version-history":[{"count":0,"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/posts\/8184\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/media\/1121"}],"wp:attachment":[{"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/media?parent=8184"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/categories?post=8184"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dmsretail.com\/RetailNews\/wp-json\/wp\/v2\/tags?post=8184"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}