Amazon’s AWS continues to lead its performance highlights

Amazon’s web services AWS continue to be the highlight of the company’s balance sheet, once again showing the kind of growth Amazon is looking for in a new business for the second quarter — especially one that has dramatically better margins than its core retail business.

Despite now running a grocery chain, the company’s AWS division — which has an operating margin over 25 percent compared to its tiny margins on retail — grew 49 percent year-over-year in the quarter compared to last year’s second quarter. It’s also up 49 percent year-over-year when comparing the most recent six months to the same period last year. AWS is now on a run rate well north of $10 billion annually, generating more than $6 billion in revenue in the second quarter this year. Meanwhile, Amazon’s retail operations generated nearly $47 billion with a net income of just over $1.3 billion (unaudited). Amazon’s AWS generated $1.6 billion in operating income on its $6.1 billion in revenue.

So, in short, Amazon’s dramatically more efficient AWS business is its biggest contributor to its actual net income. The company reported earnings of $5.07 per share, compared to analyst estimates of around $2.50 per share, on revenue of $52.9 billion. That revenue number fell under what investors were looking for, so the stock isn’t really doing anything in after-hours, and Amazon still remains in the race to become a company with a market cap of $1 trillion alongside Google, Apple and Microsoft.

This isn’t extremely surprising, as Amazon was one of the original harbingers of the move to a cloud computing-focused world, and, as a result, Microsoft and Google are now chasing it to capture up as much share as possible. While Microsoft doesn’t break out Azure, the company says it’s one of its fastest-growing businesses, and Google’s “other revenue” segment that includes Google Cloud Platform also continues to be one of its fastest-growing divisions. Running a bunch of servers with access to on-demand compute, it turns out, is a pretty efficient business that can account for the very slim margins that Amazon has on the rest of its core business.

from Amazon – TechCrunch https://techcrunch.com/2018/07/26/amazons-aws-continues-to-lead-its-performance-highlights/

Google is making a fast specialized TPU chip for edge devices and a suite of services to support it

In a pretty substantial move into trying to own the entire AI stack, Google today announced that it will be rolling out a version of its Tensor Processing Unit — a custom chip optimized for its machine learning framework TensorFlow — optimized for inference in edge devices.

That’s a bit of a word salad to unpack, but here’s the end result: Google is looking to have a complete suite of customized hardware for developers looking to build products around machine learning, such as image or speech recognition, that it owns from the device all the way through to the server. Google will have the cloud TPU (the third version of which will soon roll out) to handle training models for various machine learning-driven tasks, and then run the inference from that model on a specialized chip that runs a lighter version of TensorFlow that doesn’t consume as much power. Google is exploiting an opportunity to split the process of inference and machine training into two different sets of hardware and dramatically reduce the footprint required in a device that’s actually capturing the data. That would result in faster processing, less power consumption, and potentially more importantly, a dramatically smaller surface area for the actual chip.

Google is also rolling out a new set of services to compile TensorFlow (Google’s machine learning development framework) into a lighter-weight version that can run on edge devices without having to call the server for those operations. That, again, reduces the latency and could have any number of results, from safety (in autonomous vehicles) to just a better user experience (voice recognition). As competition heats up in the chip space, both from the larger companies and from the emerging class of startups, nailing these use cases is going to be really important for larger companies. That’s especially true for Google as well, which also wants to own the actual development framework in a world where there are multiple options like Caffe2 and PyTorch.

Google will be releasing the chip on a kind of modular board not so dissimilar to the Raspberry Pi, which will get it into the hands of developers that can tinker and build unique use cases. But more importantly, it’ll help entice developers who are already working with TensorFlow as their primary machine learning framework with the idea of a chip that’ll run those models even faster and more efficiently. That could open the door to new use cases and ideas, and should it be successful, will lock those developers further into Google’s cloud ecosystem on both the hardware (the TPU) and framework (TensorFlow) level. While Amazon owns most of the stack for cloud computing (with Azure being the other largest player), it looks like Google is looking to own the whole AI stack – and not just offer on-demand GPUs as a stopgap to keep developers operating within that ecosystem.

Thanks to the proliferation of GPUs, machine learning has become increasingly common across a variety of use cases, which doesn’t just require the horsepower to train a model to identify what a cat looks like. It also needs the ability to take in an image and quickly identify that said four-legged animal is a cat based on the model it’s trained with tens of thousands (or more) images of what a cat is. GPUs were great for both use cases, but it’s clear that better hardware is necessary with the emergence of use cases like autonomous driving, photo recognition on cameras, or a variety of others — for which even millisecond-level lag is too much and power consumption, or surface area, is a dramatic limiting factor.

The edge-specialized TPU is an ASIC chip, a breed of chip architecture that’s increasingly popular for specific use cases like mining for cryptocurrency (such as larger companies like Bitmain). The chips excel at doing specific things really well, and it’s opened up an opportunity to tap various niches, such as mining cryptocurrency, with specific chips that are optimized for those calculations. These kinds of edge-focused chips tend to do a lot of low-precision calculations very fast, making the whole process of juggling runs between memory and the actual core significantly less complicated and consuming less power as a result.

While Google’s entry into this arena has long been a whisper in the Valley, this is a stake in the ground for the company that it wants to own everything from the hardware all the way up to the end user experience, passing through the development layer and others on the way there. It might not necessarily alter the calculus of the ecosystem, as even though it’s on a development board to create a playground for developers, Google still has to make an effort to get the hardware designed into other pieces of hardware and not just its own if it wants to rule the ecosystem. That’s easier said than done, even for a juggernaut like Google, but it is a big salvo from the company that could have rather significant ramifications down the line as every big company races to create its own custom hardware stack that’s specialized for its own needs.

from Amazon – TechCrunch https://techcrunch.com/2018/07/25/google-is-making-a-fast-specialized-tpu-chip-for-edge-devices-and-a-suite-of-services-to-support-it/

Sonos prices its IPO to raise as much as $105M

Sonos today took the next step in its initial public offering price, setting a range for the shares it intends to sell that will help calibrate the final amount of money – and valuation — that it will have when it begins its trading debut.

This isn’t the final, final step in the IPO process as this is usually done to test the waters and figure out the exact appetite for the company’s shares when it goes public. Sonos is offering 5,555,555 (a wonderful palindrome of a number) shares, where it will raise as much as $105 million if it prices on the upper end of its range and sells them at $19 per share. The official range is between $17 and $19, but this can go up and down throughout the process — with a drop-off signaling a lack of interest or skepticism, and an increased range a sign of heavy demand. Companies will sometimes lowball their range, though we won’t find out for a little bit where everything lands.

Insiders are also selling 8,333,333 million shares in this initial public offering. Including that, the IPO could end up raising around $250 at the middle of that $17 to $19 range that it’s estimating including the shares sold by existing stockholders. The proceeds from those shares sold by stockholders aren’t going to end up in Sonos’ hands, so the company itself is only going to net around that $105 million at the top end of its range. There’s also an over-allotment, typically called a greenshoe, that consists of shares sold by Sonos and existing stockholders. That could add a total of $15 million and $22.5 million respectively at a price of $18 in the middle of that range.

The company is offering some preliminary estimates for its second quarter, saying it generated between $206.4 million and $208.4 million in revenue with a net loss of between $29 million and $27.1 million (this is probably because the final accounting isn’t finished up as we’re just about entering the front end for earnings season for major companies). The company said it sold between 880,000 and 890,000 products as an estimated range in the second quarter this year, up from 796,000 products in the second quarter last year.

Sonos is nicely positioned as a third-party option in an ecosystem that’s getting increasingly crowded by proprietary speakers from the larger companies that own voice assistants like the Echo, HomePod, and Google Home. But Sonos has been around for a considerable amount of time and has clearly built up a significant following to ensure that it could find itself operating as an independent public company. In its fiscal 2017 year, Sonos said it brought in nearly $1 billion in revenue, an increase of 10% year-over-year. The initial filing indicated that the company had sold a total of 19 million products in 6.9 million households, with customers listening to 70 hours of content each month.

This is basically the next step in the process as the company continues its march toward making its debut, and we’ll get more details soon enough as to whether or not investors are interested in a publicly-traded company that’s known for its speakers.

from Amazon – TechCrunch https://techcrunch.com/2018/07/23/sonos-prices-its-ipo-to-raise-as-much-as-105m/

Standard Cognition raises another $5.5M to create a cashier-less checkout experience

As Amazon looks to increasingly expand its cashier-less grocery stories — called Amazon Go – across different regions, there’s at least one startup hoping to end up everywhere else beyond Amazon’s empire.

Standard Cognition aims to help businesses create that kind of checkout experience based on machine vision, using image recognition to figure out that a specific person is picking up and walking out the door with a bag of Cheetos. The company said it’s raised an additional $5.5 million in a round in what the company is calling a seed round extension from CRV. The play here is, like many startups, to create something that a massive company is going after — like image recognition for cashier-less checkouts — for the long tail businesses rather than locking them into a single ecosystem.

Standard Cognition works with security cameras that have a bit more power than typical cameras to identify people that walk into a store. Those customers use an app, and the camera identifies everything they are carrying and bills them as they exit the store. The company has said it works to anonymize that data, so there isn’t any kind of product tracking that might chase you around the Internet that you might find on other platforms.

“The platform is built at this point – we are now focused on releasing the platform to each retail partner that signs on with us,” Michael Suswal, Co-founder and COO said. “Most of the surprises coming our way come from learning about how each retailer prefers to run their operations and store experiences. They are all a little different and require us to be flexible with how we deploy.”

It’s a toolkit that makes sense for both larger and smaller retailers, especially as the actual technology to install cameras or other devices that can get high-quality video or have more processing power goes down over time. Baking that into smaller retailers or mom-and-pop stores could help them get more foot traffic or make it easier to keep tabs on what kind of inventory is most popular or selling out more quickly. It offers an opportunity to have an added layer of data about how their store works, which could be increasingly important over time as something like Amazon looks to start taking over the grocery experience with stores like Amazon Go or its massive acquisition of Whole Foods.

“While we save no personal data in the cloud, and the system is built for privacy (no facial recognition among other safety features that come with being a non-cloud solution), we do use the internet for a couple of things,” Suswal said. “One of those things is to update our models and push them fleet wide. This is not a data push. It is light and allows us to make updates to models and add new features. We refer to it as the Tesla model, inspired by the way a driver can have a new feature when they wake up in the morning. We are also able to offer cross-store analytics to the retailer using the cloud, but no personal data is ever stored there.”

It’s thanks to advances in machine learning — and the frameworks and hardware that support it — that have made this kind of technology easier to build for smaller companies. Already there are other companies that look to be third-party providers for popular applications like voice recognition (think SoundHound) or machine vision (think Clarifai). All of those aim to be an option outside of whatever options larger companies might have like Alexa. It also means there is probably going to be a land grab and that there will be other interpretations of what the cashier-less checkout experience looks like, but Standard Cognition is hoping it’ll be able to get into enough stores to be an actual challenger to Amazon Go.

from Amazon – TechCrunch https://techcrunch.com/2018/07/17/standard-cognition-raises-another-5-5m-to-create-a-cashier-less-checkout-experience/

Apple, in a very Apple move, is reportedly working on its own Mac chips

Apple is planning to use its own chips for its Mac devices, which could replace the Intel chips currently running on its desktop and laptop hardware, according to a report from Bloomberg.

Apple already designs a lot of custom silicon, including its chipsets like the W-series for its Bluetooth headphones, the S-series in its watches, its A-series iPhone chips, as well as customized GPU for the new iPhones. In that sense, Apple has in a lot of ways built its own internal fabless chip firm, which makes sense as it looks for its devices to tackle more and more specific use cases and remove some of its reliance on third parties for their equipment. Apple is already in the middle of in a very public spat with Qualcomm over royalties, and while the Mac is sort of a tertiary product in its lineup, it still contributes a significant portion of revenue to the company.

Creating an entire suite of custom silicon could do a lot of things for Apple, the least of which bringing in the Mac into a system where the devices can talk to each other more efficiently. Apple already has a lot of tools to shift user activities between all its devices, but making that more seamless means it’s easier to lock users into the Apple ecosystem. If you’ve ever compared connecting headphones with a W1 chip to the iPhone and just typical Bluetooth headphones, you’ve probably seen the difference, and that could be even more robust with its own chipset. Bloomberg reports that Apple may implement the chips as soon as 2020.

Intel may be the clear loser here, and the market is reflecting that. Intel’s stock is down nearly 8% after the report came out, as it would be a clear shift away from the company’s typical architecture where it has long held its ground as Apple moves on from traditional silicon to its own custom designs. Apple, too, is not the only company looking to design its own silicon, with Amazon looking into building its own AI chips for Alexa in another move to create a lock-in for the Amazon ecosystem. And while the biggest players are looking at their own architecture, there’s an entire suite of startups getting a lot of funding building custom silicon geared toward AI.

Apple declined to comment.

from Amazon – TechCrunch https://techcrunch.com/2018/04/02/apple-in-a-very-apple-move-is-reportedly-working-on-its-own-mac-chips/

Uber has reportedly rescinded its job offer for the Amazon exec that was its potential product lead

Uber appeared set to hire Assaf Ronen, the former vice president of Amazon’s voice and natural user interface shopping, to lead its products — but it looks like that isn’t going to happen due to a discrepancy in his working history, according to Recode.

Uber discovered a discrepancy related to his tenure at Amazon, where the company appeared to be under the assumption he was working at Amazon at the time of offering him the job, and rescinded its offer, according to Recode. Ronen had actually left Amazon at the very end of 2017 and was not actually working at Amazon at the time, according to Recode, which posted a memo of new CEO Dara Khosrowshahi’s explanation of what happened. Ronen was brought in to take over the lead product role following the departure of former Twitter product lead and Google Maps exec Daniel Graf.

Since taking over, Khosrowshahi has tried to distance himself from the Uber under former CEO Travis Kalanick. Often times, CEOs will tell you that their number-one job is recruiting. Twitter CEO Jack Dorsey has mentioned it on a quarterly earnings call at least once a year for the past three years, for example, usually something to the extent of “my primary focus is on recruiting.” That’s obviously going to be a big tenet that will determine Khosrowshahi’s vision for the company and, ultimately, his legacy.

Current product VP Manik Gupta will be running the company’s product operations in the mean time, according to the memo obtained by Recode. Ronen would have been a marquee hire for Uber, but as the company has gone through a myriad of blunders under Kalanick, in addition to one of its autonomous vehicles being involved in an accident with a pedestrian on Monday, it looks like Uber is facing another hiccup in its turnaround at the top.

We reached out to Uber for additional comment and will update the story when we hear back.

from Amazon – TechCrunch https://techcrunch.com/2018/03/21/uber-has-reportedly-rescinded-its-job-offer-for-the-amazon-exec-that-was-its-potential-product-lead/

Facebook has signed a deal to stream 25 afternoon MLB games

 Filed under moves that are potentially groundbreaking with big implications but with quite small numbers, Facebook has signed an exclusive deal with the MLB to stream 25 afternoon games, according to Bloomberg. The deal is a bit reminiscent of the one Twitter signed for Thursday Night Football back in 2016 to stream games that are outside of the range of primetime football (usually reserved… Read More

from Amazon – TechCrunch https://techcrunch.com/2018/03/09/facebook-has-signed-a-deal-to-stream-25-afternoon-mlb-games/?ncid=rss

Amazon may be developing AI chips for Alexa

 The Information has a report this morning that Amazon is working on building AI chips for the Echo, which would allow Alexa to more quickly parse information and get those answers. Getting those answers much more quickly to the user, even by a few seconds, might seem like a move that’s not wildly important. But for Amazon, a company that relies on capturing a user’s interest in… Read More

from Amazon – TechCrunch https://techcrunch.com/2018/02/12/amazon-may-be-developing-ai-chips-for-alexa/?ncid=rss

Instacart has raised another $200M at a $4.2B valuation

 Despite plenty of uncertainty swirling around Instacart and its complex relationship with Whole Foods — now owned by Amazon — investors still seem to not be too worried, and are pouring a fresh big round of financing into the startup that values it at $4.2 billion. Instacart said it raised $200 million in a new funding round this morning led by Coatue Management, as well… Read More

from Amazon – TechCrunch https://techcrunch.com/2018/02/12/instacart-has-raised-another-200m-at-a-4-2b-valuation/?ncid=rss

Amazon did a lot of funky stuff this year and it’s paying off

 Holy hell, it’s been a year for Amazon. Jeff Bezos’ former-online-bookstore dumped $13.7 billion to buy a bunch of grocery stores, that speaker you talk to in your living room that Amazon makes is really popular and a bunch of server farms Amazon runs generate more than $10 billion in revenue annually. Read More

from Amazon – TechCrunch https://techcrunch.com/2017/12/29/amazon-did-a-lot-of-funky-stuff-this-year-and-its-paying-off/?ncid=rss

7 huge business storylines for this quarter’s earnings season

 It’s that time of the year again: Earnings season. It’s a finance nerd’s dream, but for the rest of the world, it’s important because some of the biggest technology companies in the world spill their guts to the public. We get to see who’s winning, who’s losing, what’s going wrong and how much Twitter’s monthly active user count dropped. In… Read More

from Amazon – TechCrunch https://techcrunch.com/2017/10/16/7-huge-business-storylines-for-this-quarters-earnings-season/?ncid=rss

Nestlé acquires a majority stake in Blue Bottle Coffee at a valuation north of $700M

 Blue Bottle Coffee, one of Silicon Valley’s favorite coffee projects, is selling a majority stake to Nestlé in a big semi-acquisition this morning that’s no doubt going to validate a lot of interest in the potential of coffee markets. Nestlé is acquiring a 68% stake in the company, and it t looks like the leadership of the company isn’t changing as part of this deal. The… Read More

from Amazon – TechCrunch https://techcrunch.com/2017/09/14/nestle-acquires-a-majority-stake-in-blue-bottle-coffee/?ncid=rss

Jeff Bezos should totally buy a coffee startup

 The benefits of Amazon’s $13.7 billion acquisition of Whole Foods more or less went live this week, with price cuts out the wazoo as well as a bunch of Amazon Echo devices available for sale in stores. With this massive move into grocery chains and the obvious branding play, as well as tangential benefits like suddenly getting access to hundreds of locations with fresh ingredients that… Read More

from Amazon – TechCrunch https://techcrunch.com/2017/09/03/jeff-bezos-should-totally-buy-a-coffee-startup/?ncid=rss

Where does Blue Apron go after Amazon wraps up its Whole Foods deal?

 Last week, Amazon said that its massive $13.7 billion deal to acquire Whole Foods is wrapping up on Monday — giving it access to one of the strongest food brands in the United States, as well as hundreds of grocery stores in metropolitan areas. That means it’s going to be easier and easier for people to get access to great ingredients, and there’s been a continued trickle… Read More

from Amazon – TechCrunch https://techcrunch.com/2017/08/27/where-does-blue-apron-go-after-amazon-wraps-up-its-whole-foods-deal/?ncid=rss

Let’s review some of tech’s big second quarter financial stories

 Now that the second-quarter “earnings season” — when all of the biggest public tech companies spill their financial guts to the public — is over, and it was filled with a lot of weird stories that seemed a little outside of the mold that we normally see. There weren’t any blockbuster product launches, huge advertising beats, wildly surprising numbers (outside… Read More

from Amazon – TechCrunch https://techcrunch.com/gallery/lets-review-some-of-techs-big-second-quarter-financial-stories/?ncid=rss

Stitch Fix has confidentially filed for an IPO

 Stitch Fix has filed confidentially for an initial public offering, setting itself up for another big test for the IPO market in the near future, sources tell TechCrunch. While we don’t know exactly when Stitch Fix will go public, we do know that a handful of companies are planning to go between Labor Day and Thanksgiving. Stitch Fix only recently hired its CFO, Paul Yee, in June —… Read More

from Amazon – TechCrunch https://techcrunch.com/2017/07/28/stitch-fix-has-confidentially-filed-for-an-ipo/?ncid=rss

It looks like Amazon would be losing a lot of money if not for AWS

 Amazon reported its second-quarter earnings today, and it was a bit of a whiff — and a bummer for Jeff Bezos, who is now no longer the Solar System’s richest human and has been relegated to the unfortunate position of second-richest human. The company’s earnings came in lighter than Wall Street expected. But Amazon’s cloud server farms, AWS, once again appear to be… Read More

from Amazon – TechCrunch https://techcrunch.com/2017/07/27/it-looks-like-amazon-would-be-losing-a-lot-of-money-if-not-for-aws/?ncid=rss

Jeff Bezos’ brief stint as world’s richest human ends with Amazon’s second quarter whiff

 Amazon reported its earnings today, wherein a whiff in earnings sent the stock down around 3% and brought CEO Jeff Bezos back to reality as the, once again, second richest human in the known Solar System. In all seriousness though, this is a big quarter for Amazon as it looks to close out its $13.7 billion bid for Whole Foods. The company appears to once again be squeezing out a very small… Read More

from Amazon – TechCrunch https://techcrunch.com/2017/07/27/jeff-bezos-brief-stint-as-worlds-richest-human-ends-with-amazons-second-quarter-whiff/?ncid=rss

Blue Apron COO Matthew Wadiak steps down in post-IPO shakeup

 Blue Apron announced several changes at the executive level today, including co-founder Matthew Wadiak stepping down from the COO role to become a senior advisor. Wadiak’s changing role comes after a painful IPO for the meal kit delivery service, which first had to reduce its original IPO price and has since then seen a significant drop in its share price. Some good news finally hit… Read More

from Amazon – TechCrunch https://techcrunch.com/2017/07/25/blue-apron-coo-matthew-wadiak-steps-down-in-post-ipo-shakeup/?ncid=rss

Blue Apron is having another awful day and its shares are crashing

 Since going public last month, things have not gone particularly well for Blue Apron thanks to the specter of Amazon and its $13.7 billion acquisition bid for Whole Foods. The bad news, again, continues to roll in as what may have been a competitor in theory now seems more and more like an existential threat. Blue Apron’s shares are down another 10% today, continuing a streak of mistrust… Read More

from Amazon – TechCrunch https://techcrunch.com/2017/07/17/blue-apron-is-having-another-awful-day-and-its-shares-are-crashing/?ncid=rss