Amazon is spending tens of millions on new streaming content, but it hasn't shown the ability to turn that into a profit, which is weighing on the stock.
Amazon.com (AMZN 1.30%) recently licensed 250 seasons of TV shows from Viacom (NASDAQ: VIA) in an effort to beef up its streaming business and add more members to Prime. But Netflix (NFLX 4.17%) has proven that it's extremely difficult to make money with streaming, and Amazon adds the cost of two-day shipping as well.
Fool contributor Travis Hoium thinks this just adds to Amazon's challenges and that margins won't see any improvement in the near term.
Fool contributor Travis Hoium is short shares of Amazon.com. The Motley Fool recommends Amazon.com and Netflix. The Motley Fool owns shares of Amazon.com and Netflix. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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