How Much Will Amazon.com’s (AMZN) Alexa Spending Hurt the Bottom Line? – Evercore ISI

News and research before you hear about it on CNBC and others. Claim your 2-week free trial to StreetInsider Premium here. Evercore ISI analyst, Ken Sena performed a deep dive on Amazon.com’s (NASDAQ: AMZN) Alexa business and came to the conclusion that costs could be as high as $330mm in 2016 with a substantial portion of the cost falling in 4Q. This number comes from a bottoms up analysis of personnel costs for data scientists and engineers, Echo hardware sales subsidies, training hardware (GPUs) / compute costs, and storage costs/secondary services. He breaks it down to $140mm in net hardware, $140mm in personnel, $40mm in training/compute, and ~$10 mm in other. The analyst estimates Hardware Expense of $140mm based on 8mm devices sold in 2016, a -10 to -20% gross…


Link to Full Article: How Much Will Amazon.com’s (AMZN) Alexa Spending Hurt the Bottom Line? – Evercore ISI