Rye Outsourcing - Daily

I asked ChatGPT to show me an image of how it would reflect itself as a human version of the AI interface. I told it to look a bit like a professor type.

I also prompted ChatGPT with the following:

You are a famous top rated stock market analyst, and the boss just hit you with Amazons quarterly earnings. She tells you to prepare a quick pdf about the numbers, maximum 4-5 pages incl. your outlook for next quarter earnings. She also want you to tell her how you see the stock price develop in the next 2 years.

So, I downloaded the earningsstatement from Amazon in a pdf format (12 pages in total), and this is the text it returned. (Note that I have not verified any of the data, nor do I recommend to buy or sell any assets.)

Amazon Q2 2024 Earnings Summary

Key Financial Highlights:

• Net Sales: Amazon reported net sales of $148.0 billion, a 10% increase from $134.4 billion in Q2 2023. Adjusted for foreign exchange rates, net sales rose by 11%.
• Operating Income: Increased to $14.7 billion from $7.7 billion in Q2 2023, demonstrating a strong operational performance.
• Net Income: Amazon's net income nearly doubled to $13.5 billion ($1.26 per diluted share) from $6.7 billion ($0.65 per diluted share) in Q2 2023. This includes a $0.4 billion pre-tax valuation gain from its investment in Rivian Automotive, Inc.
• Cash Flow: Operating cash flow increased by 75% to $108.0 billion over the trailing twelve months, and free cash flow surged to $53.0 billion, highlighting Amazon's strong liquidity and operational efficiency.

Outlook for Q3 2024:

• Net Sales Forecast: Amazon expects net sales to be between $154.0 billion and $158.5 billion, representing growth of 8% to 11% compared to Q3 2023. This includes an anticipated 90 basis points negative impact from foreign exchange rates.
• Operating Income Forecast: Expected to range between $11.5 billion and $15.0 billion, compared to $11.2 billion in Q3 2023.

Strategic Developments: Amazon continues to invest heavily in AWS, expanding its AI and machine learning capabilities, which is expected to drive future growth. The company's retail and subscription services are also seeing robust demand, reinforced by strong consumer engagement on Prime Day and the expansion of Amazon Pharmacy's offerings.

Outlook for Next Quarter and Beyond

Q3 2024: Given Amazon's guidance and its historical ability to meet or exceed expectations, the company is likely to continue its strong revenue growth trajectory. Key drivers will include AWS, which benefits from the global shift towards cloud computing and AI, and the North American retail segment, which remains resilient despite broader economic headwinds.

Stock Price Outlook for the Next Two Years:

• Short-Term (6-12 months): Amazon's stock is expected to experience steady growth, driven by continued revenue and profitability improvements, particularly in AWS. Potential risks include macroeconomic factors such as inflation, interest rates, and potential recessionary pressures, but Amazon's diverse revenue streams provide a buffer.
• Medium-Term (12-24 months): Over the next two years, Amazon is well-positioned to outperform the broader market, with significant upside potential as it capitalizes on the growth of cloud computing, AI technologies, and its expanding global retail footprint. The stock could see gains of 20-30% if current growth trends continue, particularly as AWS and AI-driven initiatives become larger revenue contributors.

I also asked "Chatty" as I have named him (given the image provided), to set it up in a Powerpoint presentation, and in no time at all, was provided with an 8-page deck. Please DM me if you want to see what it came up with.

If you happen to be an analyst on Amazon, I would be very interested in hearing if Chatty came close.

And again, Rye Outsourcing does not provide investment advise.