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sounds like gloom and

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sounds like gloom and

Drum roll please. Tuesday (January 31, 2012), Amazon (NASDAQ:AMZN) reported Q4 results and Wall St. puked all over them (second Q in a row, I might add) sending the shares down 1012% flirting with a new 52 week low.

If you read some of the press, it sounds like gloom and doom Amazon is making all these investments and they aren't paying off. OMG the sky is falling! I think what's happening is the mainstream press isn't understanding the big shift in this Q 3P surged and skewed the results (top line down and bottom line up) and for me that's actually a positive movement on many levels (both for Amazon and 3P sellers).

I think we'll look back on this Q as an important tipping point in the evolution of Amazon the mix shift to 3P continues to change them from a retailer to a technology company and marketplace operator. Given that weighty prediction, I wanted to spend a fair amount of time digging into the Q with our usual thirdparty (3P) focus, because it was a very important Q in that regard and gives us some clues to the mysterious missing $1b+ in Amazon revenue for the Q. Note: for this post, unless explicitly called out everything is what is know as exfx it factors OUT any changes due to currency changes.

Amazon's Q4 Results vs. Expectations Here is a snapshot of Amazon's key metrics for the Q vs. both their earlier guidance and Wall St. expectations: (click to enlarge)

From this table you can clearly see that revenue missed wall St expectations by about $1b and the bottom line exceeded (hmm, you'd think that wall st. would want expanding margins but I suppose they want revenue growth and expanding margins).

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