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Tuesday 03 August 2021

Salesforce MuleSoft moves into RPA with Servicetrace

Salesforce logoSalesforce’s latest acquisition will see it move deeper into the RPA sector with the proposed acquisition of Servicetrace. The company is an RPA specialist, founded in Germany in 2004, with a customer base that includes brands such as Fujitsu, Siemens, Merck and Deutsche Telekom. Terms of the transaction were not disclosed. 

The acquisition is being undertaken by Salesforce subsidiary MuleSoft, which was itself acquired by Salesforce back in 2018 (track progress from here). The Servicetrace transaction marks its move into RPA, expanding beyond API-centric integration and moving MuleSoft towards a unified integration, API management and RPA platform. The use of APIs to build RPA workflows, rather than graphical interfaces, is a developing trend – RPA specialist UiPath acquired API integration platform provider and MuleSoft competitor Cloud Elements earlier this year to do just this. 

The combination of MuleSoft’s API capability with Servicetrace RPA stands to broaden the MuleSoft value proposition, supporting automated workflows across data and applications. And with MuleSoft CEO Brent Hayward highlighting its use by line of business and knowledge workers to automate business processes increase efficiency and speed, the user base stands broaden too. 

The acquisition should also benefit parent Salesforce, providing capabilities to expand workflow automation within the AI/ML-enabled Einstein Automate solution; and likely add to the Slack proposition too, while enriching the Customer 360 position that aims to deliver connected experiences from anywhere. MuleSoft and now Servicetrace also stand to add to Salesforce’s abilities to connect heritage and modern applications and data sources. 

Posted by: Angela Eager at 09:57

Tags: acquisition   software   automation   RPA  

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Tuesday 03 August 2021

Square deal highlights the widespread appeal of BNPL

APThe fintech ecosystem has seen increasing activity around point of sale credit and buy now pay later (BNPL) offerings. Zilch, the UK fintech that launched in 2019, recently secured a total of $110m as it looks to promote its BNPL offering and capitalise on growth in the market (see: Zilch secures $80m for BNPL push). Meanwhile, one of the early movers, Klarna has already achieved unicorn status and is now Europe's largest fintech, highlighting the considerable potential. (see: Cash injection propels Klarna to No. 1 spot). 

Against this backdrop, the £21bn acquisition of Australian BNPL provider, AfterPay, by digital payments platform, Square, should not be a surprise. Square's founder, Jack Dorsey, one of the brains behind Twitter no doubt recognises the value of adding a convenient credit facility to his core payments offering. 

The AfterPay deal also highlights the growing maturity of some fintechs as these newcomers to the financial services arena broaden their propositions. Along with payments transactions, consumer credit is one of the key elements of the retail banking value chain. Square will be following in the footsteps of other newcomers to the banking arena, such as PayPal, that have successfully built up very significant financing operations off the back of an initial payments play. 

Posted by: Jon C Davies at 09:51

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Tuesday 03 August 2021

Delivering Social Value – become the lead sponsor for this TechMarketView breakfast webinar and secure your ‘interview’ slot.

Georgina O’Toole, Chief Analyst, and Dale Peters, Research Director PS, will be leading a discussion around the  rising importance of social value in the public sector in the first of our series of breakfast webinars this autumn. 

DaleWhether your company is ahead of the game in its social value agenda or just starting out on itsGeorgina journey, this is your opportunity to take part in this evolving dialogue. By aligning your organisation with a TechMarketView free-to-join webinar, you’ll be demonstrating to the market your commitment to this increasingly significant requirement of Government procurement.

During this live event our MD, Tola Sargeant, will interview a member of your organisation on the drive to make a difference in this environment. Be it tackling economic inequality, combatting climate change, supporting COVID-19 recovery or advancing equal opportunities, you can use this platform to highlight your approach.

In addition to this ‘speaker slot’ the lead sponsor will also enjoy a multitude of other benefits, including a Q&A session with a senior member of your team on an agreed topic, the results of which will be published as part of our research and come with free distribution rights. Add to this, four places at a live TechMarketView networking event planned for next year and a UKHotViews advertising campaign, it’s an enviable sponsorship package for any tech company doing business in UK Government.

For more information contact Paula Miles-Mathewson, Client Services or Deb Seth, Sales & Marketing Director. Please note, there is only one lead sponsor for this event.

If Public Sector is not your thing, then one of our other webinars might be more appealing:

Hackers and Defenders: How greater use of public cloud is changing the cyber security landscape.

Clarity of purpose: How the pandemic helped financial services focus on what really matters.

Making green from green: Is there revenue from the sustainability agenda?

Posted by: HotViews Editor at 09:22

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Tuesday 03 August 2021

Accenture buys a benchmarker

LogoAccenture has acquired LEXTA, a boutique consulting firm which specialises in IT benchmarking and IT sourcing advisory. Headquartered in Berlin with additional offices in Düsseldorf, Zurich and a small presence in the UK, LEXTA’s team of more than 60 professionals joins Accenture’s Technology Strategy & Advisory group. Terms of the deal were not disclosed

On the face of it, the purchase by a major IT services supplier of a business whose market appeal depends in some part on vendor independence may seem like a strange move. Accenture, however, believes the data assets and analytics capabilities which LEXTA contains will complement the new owner’s ZBx agenda. This AI platform-based Zero Budgeting approach focuses on identify cost-saving opportunities with organisations to free up funds for technology-enabled business transformation.

Posted by: Duncan Aitchison at 09:21

Tags: acquisition   systemsintegration   data  

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Tuesday 03 August 2021

*New Research* UK Financial Services SITS - Suppliers, Trends and Forecasts

The unprecedented nature of the pandemic has tested the operational resilience of the UK financial services industry and the technology sector like never before. Many individuals and firms have experienced the loss of colleagues and/or family members. Meanwhile, against this tragic backdrop, the impact of the pandemic has also served to accelerate the pace of change across the industry.

MTFFollowing a period of sustained growth, SITS spend within UK financial services contracted during 2020 with total expenditure down 1.1%. However, growth will return during 2021, as changed priorities and a widespread recognition of the transformation imperative help to drive increased activity. Meanwhile, with the sector becoming increasingly focused on business change, there have been winners and losers across the supplier landscape.

Subscribers to FinancialServicesViews can learn more via UK Financial Services SITS - Suppliers, Trends and Forecasts 2021. This report analyses the business and technology trends impacting UK financial services and includes TechMarketView’s detailed forecasts for SITS spend within the industry. The analysis also provides a ranking (by revenue) of the Top 20 vendors and examines the varying fortunes of this cohort.

If you are not already a subscriber to FinancialServicesViews, but would like access to this new research, please contact Deb Seth for more information.

Posted by: Jon C Davies at 09:19

Tags: insurance   banking   financialmarkets   wealthmanagement  

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Tuesday 03 August 2021

Unisys continues to make progress in Q2

Unisys logoUnisys' Q2 results for the three months ended 30 June 2021 show a strong recovery from the challenges of 2020. Revenue was up 17.9% (11.5% in constant currency) year-on-year (YoY) to $517.3m (Q2 2020: $438.8m). Operating profit was up by $49.3m YoY to $40.8m (Q2 2020: loss of $8.5m), and adjusted EBITDA increased to $94.4m (Q2 2020: $42.0m). Over the H1 period, revenue improved by 7.6% to $1,027.1m (H1 2020: $954.2m).

The performance was supported by growth across Unisys' three divisions. Digital Workspace Solutions improved by 9.7% YoY to $146.5m (Q2 2020: $133.5m); Cloud & Infrastructure Solutions revenue grew 9.9% YoY to $124.4m (Q2 2020: $113.2m); and Enterprise Computer Solutions was up 40.2% YoY to $169.5m (Q2 2020: $120.9m).

From a sector basis it was a reverse of Q2 2020 when its public sector business led the way. During this period, Financial revenue was up 31% to c.$160m, Commercial up 27% to c.$191m, but Public declined by 1% to c.$166m. EMEA accounted for 37% of revenue (c.$191m) during the period and was the best performing region by a significant margin, up 33% YoY (19% in constant currency).  

Unisys was heavily impacted by the COVID-19 crisis in the first half of 2020, with revenue down 23% compared to Q2 2019 (see Unisys feels the impact of COVID-19 in Q2), but things picked up in H2 (see Unisys exceeds expectations in Q4) and the recovery continues in 2021. It is making good progress against its strategic goals and enhanced its Digital Workplace Solutions business with the $152m acquisition of Unify Square, which was announced in June.

Posted by: Dale Peters at 09:16

Tags: results   cloud   security   government   financial+services  

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Tuesday 03 August 2021

Tech Mahindra bounces back

LogoPune-HQ’d IPP Tech Mahindra has started its FY22 in some style. The “strong demand acceleration” flagged by the company three months ago has delivered revenue of $1.38bn for the three months ended 30th June. This represents not only top line improvements at constant currency of 3.9% qoq and a healthy 10.8% yoy, but also the firm’s highest ever quarterly sales figure. The increased pace of expansion did, however, take a small toll on profitability with EBITDA margin easing back sequentially by 160 bps to 18.4%.

All of Tech Mahindra’s verticals and geographies grew during Q122. From an industry sector perspective, the Technology and Financial Services units, which together generate a quarter of total turnover, were the stronger performers with both seeing sales increase by north of 12% yoy. The company’s European region, with generates 27% of global turnover of which around a half comes from the UK, also expanded at a similar pace during the first three months of the new financial year.

There was further good news in the quarter on the order intake front. Net new deal wins hit $815m, up from $290m in the heavily COVID impacted Q121. The bigger contracts landed during the period included an engagement with a leading UK telecom company for end-to-end customer experience for both consumer and enterprise businesses. A much improved year, both globally and in this country, would seem to be squarely in prospect for the junior member of the offshore services top tier.

Posted by: Duncan Aitchison at 09:10

Tags: results   offshore   systemsintegration  

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Tuesday 03 August 2021

Capita's Learning Services transformation helped secure £124m renewal

Capita logoProgress on the renewals front continues at Capita with a learning services contract worth up to £124m over five and a half years.

The long-term client is a “major UK financial services institution” and the renewal, which was secured through a competitive bid process, will provide end-to-end learning services “in a more innovative, digital and efficient way”. 

The original contract with Capita covered a broad range of learning services, including learning consultancy, virtual and face-to-face learning programmes, digital and simulated learning, along with market insight and thought leadership. Capita is also responsible for procurement and management of third-party learning suppliers to the client, including administrating training and the sourcing of learning professionals to deliver on client projects.

The focus on digital and innovation highlights this as a notable renewal and what is just as significant is that it came about partly as a result of Capita Learning’s transformation that aims to overhaul corporate learning and development. Recent moves have included a partnership with enterprise learning technology company Obrizum Groupfor its AI-driven teaching platforms (see Capita looks to scale up with Obrizum), and with learning technology provider Filtered which focuses on enabling organisations to bring more targeted skills and capability acquisition to employees.

The need for talent and skills development, coupled with changes to the workplace currently being worked through as a result of COVID, points to opportunities around corporate learning where it can be delivered in an engaging and effective way. 

Posted by: Angela Eager at 08:44

Tags: contract   learning  

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Tuesday 03 August 2021

Backers connect with Connectd to connect founders without connections

logoI find it somewhat counterintuitive that a platform that brings together founders and potential investors "without relying on connections” actually calls itself Connectd – but maybe it’s just me.

That said, the concept of a matchmaker platform for the growth funding marketplace where investors, entrepreneurs and non-executive directors (NEDs) can seek each other out seems sensible enough on the face of it, if it wasn’t for the fact that there are apparently 288 other platforms doing something similar (Source: Traxcn).

Founded in 2019 by angel investor Roei Samuel and launched in February 2020, London-based Connectd has raised $1m in seed funding mainly from other angels.

Connectd charges startups £299 for an annual subscription to the platform, including “>£20k free credits with our partners including AWS, Stripe, Airtable & Hubspot”. NEDs pay £347 p.a. to access the platform (how did they arrive at that precise price, I wonder?), which also includes “Educational content”. Investors don’t pay to use the platform, which is just as well, as there are numerous well-established startup/scaleup data providers they can subscribe to which undoubtedly have a more extensive database.

Connectd claims that the platform is being used by a number of VCs and over 1,000 angel investors – all of whom don’t pay a penny – and has helped almost 100 businesses raise capital – who at most would have paid £299 each.

As they say in the classics, “Show me the money”!

Posted by: Anthony Miller at 08:17

Tags: funding   startup  

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Monday 02 August 2021

Brazil’s mega-retailers battle on for fastest delivery honours

picWhile the battle for who can deliver your shopping the fastest is played out amongst startups here in the UK (e.g. Dija fast-starts 10-minute grocery delivery service – no, seriously!), in my ‘adopted’ country of Brazil it’s the mega-retailers that are vying for that ‘honour’ – and they’re doing it in the courts.

According to Valor (‘Brazilian FT’), Brazil’s three largest ecommerce retailers, Mercado Livre (online marketplace), Magalu (the online presence of bricks-and-mortar retailer Magazine Luiza – rather like Currys) and Americanas (retailer Lojas Americanas – sort of Woolworths on steroids) are in legal dispute as to who really is the fastest. Amazon is in the Brazilian market but sits behind the ‘natives’.

The first trial concluded in June and in typical Brazilian fashion, everyone says they won! In fact, Mercado Livre, Magalu and Americanas, were all forced to make changes to the "faster delivery" message on their websites. While Americanas was happy with the decision (or perhaps the least unhappy), Mercado Livre and Magalu have lodged an appeal.

Round 2 will be held in September. Ringside seats available via UKHotViews!

Posted by: Anthony Miller at 09:38

Tags: brazil   ecommerce  

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Monday 02 August 2021

NTT DATA simplifies again

NTT DATA logoNTT has undertaken a number of actions over the last few years to simplify its structure (see NTT announces simplified structure). One of its aims is to for NTT DATA to operate as one globally; it is thought this will simplify and strengthen the organisation, reflect shared vision and values, and enhance greater and more seamless collaboration under a single NTT DATA brand.

Back in May, it was announced that wholly-owned subsidiary group companies, everis and itelligence, would integrated into the NTT DATA brand (see everis & itelligence integrated into NTT DATA brand). Today, NTT DATA announces that it has newly established NTT DATA EMEAL (Europe, Middle East, Africa, Latin America) and would start its operation from 14th September. The move brings everis (with a presence mainly in Europe and Latin America) and NTT DATA EMEA (with a presence mainly in UK, Italy, Germany, and Romania) under the same management. The resultant organisation will have 38k employees across 25 countries and revenues of €3b. The move will also enable NTT DATA to further collaborate with other NTT Group companies as one NTT, offering both global reach and local intimacy. Fritz Hoderlein, currently CEO of everis, will become CEO of NTT DATA EMEAL.

Within TechMarketView research, we already include revenues from everis and itelligence in our estimates of UK revenues (see UK SITS Ranking 2021); the company is ranked 23rd in our rankings of IT and business process services suppliers to the UK market (up 5 places compared to a year previously) and is a Top 10 supplier of Application Operations. It has consistently delivered double-digit-growth in its UK revenues over the last few years and continues to rise up the rankings. Globally, NTT DATA aims to be one of the top five companies in the IT services market by 2025.

Posted by: Georgina O'Toole at 08:51

Tags: reorganisation   itservices  

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Monday 02 August 2021

Regulators scrutinise Monzo as revenue and losses grow

MonzoDigital “challenger” bank, Monzo, has published its latest annual results revealing healthy revenue growth and another year of significant losses. For the twelve months ended 28 February 2021 (FY21), Monzo reported revenue of £66m, representing an annual increase of 18%. Meanwhile, the bank recorded a net loss of £130m, up 13% on the prior year.

During FY21 Monzo secured new investments totalling more than £200m, leading to the app-based bank achieving a valuation of £1.2bn. However, as a results of its funding dependency, Monzo’s latest accounts once again contain a warning that there is “material uncertainty” over the bank’s ability to continue as a going concern (see: Monzo shores up finances with additional £60m).

Monzo has also revealed that it is currently under investigation by the Financial Conduct Authority (FCA) for possible breaches of financial crime regulations. The FCA has recently contacted several UK banks, including Monzo, highlighting weaknesses in their AML controls.

Monzo found the going especially tough during the early stages of the pandemic, however, the bank has indicated that as conditions have improved, its actual revenue growth has increased to around 30%. Despite some of the obvious challenges it faces, Monzo's CEO, TS Anil remains optimistic that the bank is on the path to profitability, following in the footsteps of its rivals Starling and Revolut.

Achieving market share has been one of Monzo's key priorities in the six years since its foundation. With around five million customers now on board, the bank has clearly been successful in this primary objective. Furthermore, Monzo has had to endure unprecedented disruption in the shape of the coronavorus, without the vast reserves of its established rivals. Monzo's growing customer base demonstrates the public demand for viable alternatives to the traditional brands and many will therefore be hoping that its balance sheet continues to improve. 

Posted by: Jon C Davies at 08:30

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Monday 02 August 2021

Record quarter for deal wins at Mphasis

logoBangalore-based, offshore services firm Mphasis didn’t quite make the 20%+ headline growth of many of its mid-tier peers, but the 19% increase it did record in FQ1 (to 30the June), to $363m, was nonetheless a creditable result. Operating margins, at 15.9%, also fell short of some peers, and was a tad down on recent quarters. However, net profits rose by 23% leveraged by FX and other ‘below the line’ gains.

As has been the case for the past couple of years (see Mphasis emphasises direct channel sales), it was the Mphasis ‘Direct’ channel that did the heavy lifting, as revenues from ex-parent HP/DXC crashed a further 47% to represent just 9% of total revenues. This is no bad thing, showing that Mphasis is more than capable of ‘catching them' as well as 'skinning them’ on its own merits. Indeed,  Mphasis recorded deals worth over $0.5b TCV from the Direct channel in the quarter, the highest level on record.

Posted by: Anthony Miller at 08:05

Tags: offshore  

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Monday 02 August 2021

*NEW RESEARCH* Positive Q2 market performance despite ongoing inflation uncertainty

Indices chart Q2 2021The main tech indices which we track enjoyed a positive second quarter to 2021. The FTSE 100 continued its steady YTD performance, posting 4.8% growth QoQ, although that figure masks a near flat month in June.

The NASDAQ grew by 9.5% QoQ, thanks to a much stronger month in June than had been the case in May. The FTSE SCS, representing UK listed software and computer services stocks, mirrored the NASDAQ's choppy quarter, growing 9.7% QoQ.

Subscribers to the TechMarketView Foundation Service and UKHotViews Premium can read more by downloading the Q2 2021 edition of IndustryViews Quoted Sector.

Posted by: Tania Wilson at 08:00

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Monday 02 August 2021

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Posted by: HotViews Editor at 00:00

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Sunday 01 August 2021

Share Performance in Jul 21

Summary

SharesThe indices we follow (as shown in the table) do not really convey the significance of the (largely) Q2 results announced in July. NASDAQ, TechMark and the FTSE Software and Computing Services Indices all advanced between 1% -3% in July. But all are still showing impressive gains YTD – NASDAQ up 14%, Techmark100 up 11% and the FTSE SCS Index up 16%. All have outpaced the FTSE100 which, with a 9% gain, has hardly been sluggish either.

The rebound in ‘non-tech’ stocks is understandable given the battering they had in 2020 and the high expectations of a rebound as C-19 pressures ease (we hope!) But tech had a stonking 2020  (indeed has had a ‘Very Good C-19’) and many expected growth to slow in 2021. That just hasn’t happened – so far. But the expectation is that this slowdown WILL be evident in Q3 & 4. Some pundits are forecasting a ‘bursting of the bubble’ with a major ‘correction’. But we’ve heard that many times before and it just ain’t happened. Tech is nowhere near as highly valued as it was in 2000 and is now a crucial/essential part of both corporate and consumer life.

Outlook?

If you believed the pundits, tech is in for a big correction. But they have been saying that for as long as I can remember and if you had taken note you would have missed out on some pretty hefty gains. Problem is that one day they will be right (a bit like a stopped clock tells the right time twice a day!)

It is obvious that as Q3 and Q4 in 2020 were such bumper quarters for Big Tech, comparisons this year are bound to look a bit more subdued. But the trends in Big Tech during lockdown are not likely to go into reverse. Online shopping, WFH etc are ‘here to stay’. Expect corrections along the way but a massive Bear Market in Tech doesn’t seem that likely to me!

And, for the record, it is a long time since I sold any of my tech stocks…

HVPMore detail and comment in HotViews Extra!

All the detail and comment on the Winners and Laggards in our Review of Share Performance in July 21 on HotViews Extra available to all subscribers including HotViews Premium. Why not join them for just £395pa?

For more details CLICK HERE

Posted by: Richard Holway at 12:33

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Friday 30 July 2021

Deliveroo bids ‘adios’ to Spanish market

logoAfter announcing earlier this month that management “sees an opportunity to make further discretionary investments into growth” (see Deliveroo takes ‘dish half full’ view to raise guidance), management has in fact decided to shut down its operations in Spain.

According to the just released news, Deliveroo is to enter into consultations with its employees and riders in Spain which is expected to lead to its exit from that market. Spain represents less than 2% of Deliveroo's GTV (gross transaction value) in H1 2021.

With competition intensifying from the usual – and unusual – suspects in the meal delivery industry, you have to be among the top two or three in any country market – or have a defensible niche position – if you have any realistic chance of survival let alone prospering.

While Deliveroo’s overall GTV rose in the June quarter,  average order value declined. Management had also reset gross margin expectations to the lower end of prior guidance.

Though it will undoubtedly injure management's pride, it seems unlikely that dumping Spain will materially change Deliveroo’s prospects, although any action to stem the losses can be no bad thing.

Posted by: Anthony Miller at 09:44

Tags: marketexit  

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Friday 30 July 2021

*UKHotViewsExtra* Embark deal highlights increasing role of technology in UK wealth management

LBGLloyds Banking Group (LBG) has announced a deal to acquire digital wealth management specialist, Embark Group for £390m. The “robo-adviser” platform currently has around 425k retail customers and more than £40bn of assets under administration.

EmbarkEmbark has enjoyed strong growth since its foundation in 2013 thanks in part to its strategic partnership with wealth management technology provider FNZ. A lot of this growth has been achieved via acquisition, with Embark having added Zurich’s retail wealth platform and the Horizon and Alliance Trust portfolios.

The highly competitive UK wealth management sector has seen significant change in recent years, influenced by tight margins and new technology-based approaches and the Embark deal is very much part of that wider trend. My latest UKHotViews Extra Embark deal highlights increasing role of technology in UK wealth management examines the acquisition and explores some of the other activity taking place in the sector, driven by the influence of technology. 

HVPTechMarketView clients, including HotViews Premium subscribers, can download this UKHotViewsExtra now. If you do not already have access but are interested in reading this or any other content, please contact Deb Seth for more information.

Posted by: Jon C Davies at 09:33

Tags: M&A  

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Friday 30 July 2021

AWS accelerates in Q2

awsThe second quarter of 2021 has proved to be rather positive for Amazon Web Services' top line, with growth accelerating over both last year and last quarter.

Net sales came in $4bn larger than Q2 in 2020 at $14.8bn. That translates into a year-on-year growth rate of 37%. Incredibly, despite its increased size, AWS grew faster in the second quarter of this year than Q2 in 2020 (+29%). Indeed, that 37% growth rate is fastest than any quarter of 2020. The firm has seen growth “reaccelerate” as an increasing number of organisations bring forward their digital plans - and their shift to cloud as part of that.

The tale is different to that of parent company, Amazon, which came in just shy of expectations (+15%). Shares in the company subsequently dipped c6% in after-hours trading - but they are still up c4% in the year to date (see Amazon miss hits shares).

On the margin front, the situation is slightly different. Operating income hovered at around the $4.1bn mark, but the margin slipped from 30.8% in Q1 to 28.3% this quarter. Q2 in 2020 was the most profitable three months of that year, at 31.1%.

See how AWS places in our Infrastructure Operations Supplier Rankings report (spoiler alert: it’s racing up the rankings!)……out today.

Posted by: Kate Hanaghan at 09:30

Tags: results   cloud   AI   machinelearning  

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Friday 30 July 2021

Amazon miss hits shares

AmazonOn the surface, Amazon’s Q2 results were pretty excellent with revenues up 27% at $113.1b (its 3rd >$100b quarter in a row) and profits up >50% at $7.8b (a record). The ‘problem’ was that revenue came in shy of expectations. This was particularly evident in its main online business which grew at ‘just’ 15%. its North American division recorded growth of ‘just’ 22% - half of historic levels.  Then Amazon warned of slowing growth in the quarters to come – much as Facebook had done the day before. Q3 growth of c16% is expected – much lower than previous quarters or what was expected. Comparisons with bumper quarters, when the US and the World were in lockdown, won’t help. It remains to be seen whether consumers will retain all their shopping online or stray back to physical shops as they venture back out to the office or on vacation.

There were two brighter spots:

Amazon Web Services grew by 37% to $14.8b – one area where Amazon beat expectations. See AWS accelerates in Q2.

Amazon ‘Other’ businesses which is primarily its Advertising operations, grew a massive 88% to $7.9b. Regular readers will know that for years I have contended that the likes of Facebook and Google face their stiffest digital advertising competition from Amazon. If you want, say, a new camera that you will undoubtedly buy via Amazon Prime with its ‘free’ next day delivery and amazingly efficient returns policy, then surely you would do your product search on Amazon? Well, that’s what I do!

Amazon now employs over 1.3m people worldwide – up >50% on a year back. Indeed they have announced plans for 10,000 new UK jobs and a £10m training programme aimed at upskilling 5000 existing UK employees. Amazon also acts as a both a ‘shop window’ and logistics operation for countless SMEs. It may well have been responsible for putting many small shops out of business. But conversely can claim credit for starting and sustaining many ‘Ma and Pa, top of the kitchen table’ type businesses too.

I’m also constantly impressed by Amazon’s technical innovation. How Apple let Amazon’s Alexa steal the voice activated home/car speaker/connected home market is beyond me. They also seem to be leading the world in ‘Just Walk Out’ store technology.

Mustn’t forget Amazon Prime video where Clarkson’s Farm was a particular hit in the Holway household.

Amazon’s shares fell c6% in after-hours trading but are still up about 4% YTD.

Footnote

I’ve just noticed that it is the 10th anniversary of me buying my Amazon shares in early 2011 at 118p. They have since grown over 30x (amazing) and are now the biggest single holding in the Holway Portfolio. Let’s hope that Andy Jassy can look after my investment as well as Jeff Bezos has!

Posted by: Richard Holway at 07:42

Tags: results  

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