Back to top

Image: Bigstock

Amazon Gains Competitive Edge on New Alexa Features & Echo

Read MoreHide Full Article

Amazon (AMZN - Free Report) is firing on all cylinders in the smart home space on the back of its robust voice assistant Alexa, smart speaker Echo and other home automation products.

Recently, the e-commerce giant unveiled some new Echo devices along with few companion devices. Additionally, Amazon has added quite a number of new smart features to Alexa.

The latest move of the company is in sync with its goal of launching at least eight new devices supported by Alexa by the end of the year. Moreover, growing proliferation of smart home device worldwide bodes well for the company’s continued focus toward expanding its smart home automation product portfolio and strengthening Alexa skills.

Coming to the price performance, shares of Amazon have returned 63.8% over a year, outperforming the industry’s rally of 29%.



New Products & Updates to Aid Growth

The new Echo devices comprising the likes of All-new Echo Dot, Echo Plus, Echo Show and Echo Auto intends to deliver enhanced smart home and car experience to the users.

Moreover, the new companion devices such as Echo Wall Clock, Echo Input, Echo Sub, Echo Link and Link Amp will strengthen the performance of Echo smart speakers.

All these will support the company to rapidly penetrate the global smart speaker market which as per a report from MarketsandMarkets, is expected to reach $11.8 billion by 2023 at a CAGR of 34.4% between 2018 and 2023.

Additionally, the company introduced two smart home devices namely AmazonBasics Microwave and Amazon Smart Plug enabling the householders to control their devices with voice commands. While the first device will help in cooking, the second one will control fans, lights and other electrical home appliances.

Further, new Alexa home safety features like Hunches, Video Doorbell, Alexa Guard, to name a few are likely to boost the user base of Alexa with the increasing theft and other major crimes at homes across the world.

Moreover, the new entertainment features like TIDAL, Visual Alexa Blueprints, Left-Right Stereo Pairing along with other necessary features that make daily life convenient and hassle-free are likely to help Amazon gain further momentum in the global market for intelligent virtual assistant.

Per a report from Research and Markets, this market is expected to witness a CAGR of 32% between 2018 and 2023 and to go beyond $9 billion by 2023.

We believe the above mentioned strong endeavors will aid the company in reaping benefits from the rapidly growing global smart home automation market which is expected to reach $137.91 billion by 2023 at a CAGR of 13.6% between 2017 and 2022.

Strengthening Competition

The vast growth opportunities in the smart home automation market are enticing enough to attract other tech companies like Apple (AAPL - Free Report) , Alphabet’s (GOOGL - Free Report) Google, Microsoft (MSFT - Free Report) and Samsung.

All these companies are leaving no stone unturned to bolster their presence in the world of virtual assistants and smart speaker driven by artificial intelligence (AI) and machine learning techniques (ML).

Nevertheless, with the flurry of smart devices and ever growing Alexa skills, Amazon will continue to gain competitive advantage against these other players. Further, the combination of Alexa and Echo will help the company to maintain its dominance in the market.

Currently, Amazon carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>

Published in