28/07/2017 World Business Report

Amazon founder Jeff Bezos briefly becomes the world's richest person.

But Wall Street nerves about the company's massive spending

Will the latest figures on the US economy bring President Trump closer

a billion-dollar round of coffees as Starbucks buys out

It has seen its shares fall sharply after its latest figures

The good news - it is raking in huge sums of money

The bad - it's spending a fortune on developing its business,

and that is making investors nervous.

Total sales in the three months to June jumped almost a quarter

compared to last year to just under $38 billion.

Unfortunately, they spent almost all of it!

Operating expenses surged to well over $37 billion.

That means there wasn't much actual profit -

a comparatively measly $197 million, and down 77% on last year.

Amazon is investing massively in everything from TV and movie

content to new warehouses for the global expansion

Like this - the deal it announced last month to buy the supermarket

chain Whole Foods for over $13 billion.

Amazon has been putting increasing pressure on bricks and mortars

Optimism about the company's future has helped to push up

Since January, Amazon shares have risen by more than 40%

to a new record, making the company worth about $500 billion.

That has proved very lucrative for this person -

On Thursday, he became the richest person in the world,

As the share price has come down again, he has dropped back

What you have to remember is the market is making him rich

based on his ownership of Amazon, and Amazon is not making a heck

The market is saying that, at some point in time,

they will generate so much market share that they can

This is extremely profitable, and that's so he's done

So it's really a tribute to someone who latched on to the strength

of the so-called new economy, and internet economy,

Riaz Kanani, co-founding partner of marketing agency,

This is quite typical of Amazon, they make a lot of money and they

invest a lot of money and they are not interested in banking profits

might have markets reacted so badly? Two major regions, -- reasons, the

lead up to these results, they were expecting them to not invest

heavily. The other major reason is Amazon has really aggressively

invested and as a result the markets have had. Why were investors not

inspected them to do what they usually do? The last couple of years

they have been comfortable, they have been growing, they continue to

invest but I think they under estimated how much, having really

taken significant market share, I mean, Amazon prime now have nearly

50% of American households which is astonishing when you think about it

is a subscription to an e-commerce retailer. So they are pushing on,

they are going to invest further in faster delivery, different types of

delivery, as well as pushing internationally. Jeff Bezos isn't

just building a company, and Empire is almost too small a word for what

he's trying to create, he going global, into TV and video, we are

seeing the purchase of Whole Foods, where do you think rob one could go

next? The rumour is internally they are working on a communications

platform, it would compete with lock-up and Facebook. Instant

messaging, video chat, that kind of thing. -- WhatsApp. It's a natural

next step for them, given there are Alexa device they launched which has

been extremely successful which allows you to order things by voice.

You know, choose to play music by voice. Briefly, Amazon is part of

this text table of Facebook, Amazon, Netflix, Google, Alphabet, with the

result this week from Facebook and Alphabet, how do is Amazon's

compared to their tech partners? Very different, Facebook and Google

are very much still advertising companies. Whereas Amazon throughout

it all is really still an e-commerce, and this tradition

business, that is what they do, --a distribution business. That is their

core business. But how they view the world. Thank you for joining us.

Let's stay in the US where in a few hours' time,

we get economic growth figures for the three months to June.

It's an important set of numbers for President Trump.

He has been promising an annual growth rate of 3% or more.

But GDP growth in the first quarter - the three months to March -

Samira Hussain reports from New York.

The question is... As candidate for president Donald Trump had ambitious

goals for America's economy, believing he could make the

country's GDP saw. We are bringing up from 1% up to 4% and are actually

think we can go higher than 4%, I think it could go to five or 6%. But

the realities of governing the country have a president singing a

somewhat more muted tone. The various players on President Trump's

economic team have suggested that America's economy could grow in and

around 3%. You would need productivity to go back to levels

seen at only the peak of the tech boom in order to get sustainable

rates of growth at a 3- 3.5% or better, we have only done that for a

few years in the entire post-World War II environment. I think it's

very unlikely that anything on the fiscal policy front will go to the

sustainable 3% or better. It was fiscal policy that had the

International Monetary Fund downgrading America's growth

prospects for both PC the next. In the IMF's opinion, whatever fiscal

policy does get made may not be as growth boosting as previously hoped

for. The continuing saga of repealing and replacing Obamacare

has had a cascading impact on President Trump's legislative

priorities, reforming this country's compensated tax code, and passing on

billion-dollar spending bill, with things that would have a direct

impact on America's economic growth. But the likelihood of getting either

of those two things anywhere close to the President's desk is looking

highly unlikely. Let's go to Asia now,

where coffee giant Starbucks It is buying out its eastern Chinese

partners, spending $1.3 billion on the 50% of the business it

doesn't already own. It's the biggest deal

Starbucks has ever done. What has been the reaction to this

announcement? Quite a bit, reason why they are doing really is because

China is Starbucks's fastest-growing market outside the US a number of

stores, the deal will really help the company reach its target of

operating some 500,000 stores in mainland China by 2021. This

announcement of course percolating just as the Seattle -based site --

Starbucks announced its profit, income fell about 8.3% until July

which matched market expectations and of course the latest results

come, really, the first under the new chief executive Kevin Johnson

who took over from the co-founder how Witchell in December. He

describes the China buyout as part of the firm's long game to deal with

calling growth in the US. We know of course Starbucks is the world 's

largest coffee chain, it has really been affected by reduced footfall in

America's High Street and shopping centres and lots more consumers are

shopping online and hence the move to target China and Asia. Thank you.

Air France-KLM is buying almost a third of Virgin Atlantic,

leaving Sir Richard Branson's parent company, Virgin Group,

with a minority stake in the airline he founded.

Air France-KLM is taking a 31% stake, worth ?220 million,

in Virgin Atlantic as part of a four-way joint venture

Virgin Group's share will fall from 51% to 20%,

Sir Richard said he would remain "very much involved" after the deal.

Germany's transport minister has announced a recall of 22,000 Porsche

cars to remove what he says is illegal emissions-controlling

He said that luxury marque Porsche would bear the cost of the recalls

of the affected 3-litre Cayenne models.

Let's have a look at the markets. Driving those markets down is the

top story, the Amazon results. Sales revenue is up the profits are down

is Amazon reinvest a lot of the money and that is pulled down the

markets in Asia. The price of oil was down slightly. We will keep an

eye on that across the morning. Thank you.

The BBC understands at least 60 buildings have failed

the government's whole system fire test in the wake