Amazon reports its Q2 2013 results after the bell this week on Thursday, July 25th 2013. eBay and Google had mixed results, both citing international macro-economic slowness as key headwinds and mobile/US as key tailwinds.
The following table details the key seller-oriented metrics we track in Amazon’s results that we think most illustrate how not only Amazon is doing, but most importantly for readers of this blog, the health of the third-party (3P) marketplace. (click to enlarge)
Reading through the Wall St. reports, the key metrics this Q:
- Paid unit growth – More on this one in a second.
- 3P mix – Wall St. sees this moving up to 42% from last Q’s 40% as Amazon continues to see mix move from 1P to 3P
- 3P unit growth – Historically 3P has been growing almost 2X as fast as 1P, will that continue this Q?
- Active users – As you see in the dashboard, Amazon will need ~218 active users to keep up the 21% y/y growth pace in this key metric
- Amazon Fresh – Amazon expanded this program out of the Seattle area and into LA in Q2. Everyone will be eager to hear a) why and b) any early news. Most interesting for sellers, even if you aren’t in the grocery category, is Amazon is offering ‘all you can eat’ next day non-grocery delivery plus grocery delivery for $299/yr – kind of a super-prime+groceries offering.
- fulfilment – Amazon has announced a couple of new states since last Q, Wall St. is eager to hear if they signal any slow-down or speed-up here.
- International trends – Amazon has a lot of exposure to Japan, UK, and Continental Europe. There have been some big currency swings there that could create headwinds and as mentioned, both eBay and Google had observations in their results about macro-economic weakness in those regions.
Why the focus on paid units?
The chart above shows Amazon’s y/y paid-unit growth from Q4 2012 through the estimate for Q2 2013. As you can see paid-units are slowing and many project that trend to continue. With the launch of Kindle in many new geo’s some analysts believe Q1/Q2 could be the low-point for this metric.
We’ll be publishing our detailed analysis Friday morning after the dust settles on Amazon’s Q2 announcement. Stay tuned!