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Technology

Amazon’s Fire phone flop: A watershed for investors?

Investors are losing patience with Jeff Bezos’ game. Amazon stock swooned Thursday and it’s diving deeper today after the company reported weak earnings and predicted a dismal holiday season.

Since Amazon began in 1994, founder and CEO Bezos has focused on category expansion, revenue growth and beating off or buying the competition – and not so much on profits, which have rarely exceeded the razor-thin.

Long-term investors have done extremely well by Amazon, some of whom have seen increases of several hundred percent as Bezos expanded far beyond retail into e-readers and tablet computers, cloud data storage, music and movie streaming, Hollywood movie production and more. Its new Fire phone, which went on sale in July, so far has flopped, and might mark a watershed for investor sentiment.

Zacks.com Friday mused on “Why Amazon Shares Crashed,” stating “Amazon has taken a very aggressive stand to maintain supremacy in its chosen markets, but whether it will succeed in these plans looks like an open question now.” 

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Some analysts downgraded Amazon stock. But Bezos still has his defenders. such as Jennifer Booton at MarketWatch, noting how some analysts “look past” the “failed Fire phone” and see great things.

Still, John C. Ogg, writing for 24/7 Wall Street, says that even analysts “giving up hope” on Amazon are doing so with “not enough conviction.”


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