For all its size and power, people continue to underestimate Amazon by focusing on what the company's already doing, instead of looking where it will go next.

Why it matters: Amazon is never content with just growing its share of markets it's already in. It always has an eye toward what large market it can upend next.

Driving the news: Amazon announced Thursday it plans to buy health care provider One Medical for roughly $4 billion.

• It's hardly the company's first move into health care: Amazon already owns an online pharmacy after buying PillPack, and it operates Amazon Care, a virtual primary care service.

How it works: Like an iceberg, Amazon is always a bigger threat than what's visible from the surface.

• In its earliest days in the '90s, observers worried about Amazon's impact on bookstores. But the company was already laying plans to take over other parts of online retail.
• By the time rivals were worried about Amazon's dominance of online retail as a whole, it was moving into related areas, including logistics, third-party marketplaces and web services.
• As the world woke up to Amazon's strength in those areas, the company was already expanding into physical retail. Whole Foods was its largest play, but it also entered the cashier-free market with Amazon Go, whose technology it's now licensing to others.

Between the lines: Amazon has seized all this turf with little challenge from regulators.

• Antitrust law tends to focus on companies amassing too much power in one market — but Amazon keeps hopping into largely new markets.
• Conventional antitrust doctrine does bar companies from abusing their power in one market to control another one. But such behavior can only be identified after the fact, leaving regulators struggling to catch up.

Critics say Amazon's saga shows the urgent need for antitrust reform — something Congress has been weighing, but has yet to move forward with.

• "Amazon is basically saying to Congress, 'Catch me if you can,'" Sacha Haworth, executive director of the Tech Oversight Project, said in a statement. "Amazon having back door access to private health care data is frankly a terrifying thought."

What's next: Regulators are expected to review the acquisition carefully.

• FTC chair Lina Khan made her reputation with research into Amazon's practices and has been working to rewrite merger guidelines to address these kinds of deals.

Whatever happens with One Medical, Amazon is likely to face heavier regulations down the road.

• The company's so big it's starting to bump into itself, as evidenced by the charge that it uses sales data to compete with its third-party marketplace vendors. A recent report notes that Amazon has scaled back its white-label products business and could scrap it entirely.
• If it does end up acquiring One Medical, Amazon will be plunging deeper into a medical business that's much more tightly regulated than any other area it has operated in.

The other side: Amazon, for its part, says it knows this, and that's why the public should rest easy about its custody of their medical data.

• The company notes in a statement that "nothing about this transaction changes One Medical's obligations to comply with the Health Insurance Portability and Accountability Act (HIPAA) and all their applicable laws and regulations."

A disappointing outlook from Snap Inc. spooked investors and heightened concerns that the once fast-growing online ad business is headed for a significant slowdown, Axios' Sara Fischer reports.

Why it matters: Snapchat's Thursday earnings report could spell trouble for a range of other companies, including giants Google and Facebook.

Catch up quick: Snap had already warned investors it would miss its second quarter guidance, but Thursday's report and outlook were even worse than anticipated.

• The company declined to predict revenue or earnings for the coming quarter, but said, "It will likely take some time before we see significant improvements."
• Shares of Snap Inc. were down more than 26% in after-hours trading Thursday after the company said revenue growth would meaningfully slow in the months ahead.

Be smart: Snap cautioned investors not to expect the same revenue growth levels they've become accustomed to over the past four years.

• Between 2018, its first full year as a public company, through the end of 2021, Snap grew revenue at an average compound annual rate of more than 50%.

Yes, but: Snap's user growth remained strong last quarter, beating Wall Street's expectations. The company added 15 million daily active users (DAUs) last quarter, bringing its total number of active users to 347 million globally.

What's next: In a statement, Snap CEO Evan Spiegel said the company will try to boost revenue from direct-response advertising.

Bottom line: "This is a mess. This is kind of the worst case scenario we could've envisioned," Rick Heitzmann, founder and partner of FirstMark and an early Pinterest investor, said of the earnings on CNBC.

The video game industry's biggest trade group is weathering a revenue shortfall, even as it continues to shape public policy around games, Axios' Stephen Totilo reports.

Driving the news: Revenue for the Entertainment Software Association dropped more than $10 million, or 25%, in the 12 months ending March 31, 2021, due to the lack of its E3 trade show in recent years, according to an Axios review of its tax filings.

Why it matters: The ESA, which has 30 corporate members including EA, Tencent, Sony, Nintendo and Microsoft, is one of the industry's power players, but what it does tends to fly under the radar.

• Among its most prominent duties: running E3 and the Entertainment Software Ratings Board, which applies ratings to games.

What they're saying: The ESA serves as "the voice" of the industry, the group's president, Stanley Pierre-Louis, told Axios in an interview. It strives to perpetually boost gaming's reputation while lobbying D.C. and state lawmakers.

• In 2021, the ESA spent $2.5 million in lobbying and millions more in advocacy involving such issues as intellectual property, child safety, free speech and STEM education.
• After its founding in 1994, it had to focus on playing defense against U.S. politicians, largely Democrats, who blamed games for violence.
• These days, the ESA is staking policy positions on loot-boxes (not gambling; let the industry self-regulate), immigration (supportive of visas for high-tech workers and esports athletes and backed the Deferred Action for Childhood Arrivals, or DACA) and more.

What's next: The ESA's E3 show is set for a return in 2023, with events firm ReedPop producing.

Trading Places

• Canadian telecom firm Rogers Communications has replaced chief technology officer Jorge Fernandes with industry veteran Ron McKenzie, per The Globe and Mail. The move follows a massive outage that left customers without service nationwide.

ICYMI

• The Senate is moving toward approving a compromise on a bill subsidizing domestic chip manufacturing and funding other efforts to compete with China. The latest version brings the funding level closer to the original $250 billion. (Axios)
• YouTube will begin removing and labeling certain abortion-related content on the video-sharing platform. (Axios)

In honor of making it to Friday, I give you ... some amazing cat faces.