Posted on 10/23/2014 11:29:47 AM PDT by C19fan
Amazon.com Inc. reports quarter three earnings today and analysts are expecting a loss of $0.75 per share according to FactSet. That’s a significant jump from their loss of $0.09 per share for the same period last year. Amazon follows a “profitless prosperity” model so losses aren’t unexpected, and typically Wall Street shrugs them off. This year, however, Amazon (AMZN) has seen more than a 20% drop in value on the NASDAQ.
Wall Street is becoming restless-- is it time for Amazon.com CEO Jeff Bezos to start focusing on the bottom line?
Yahoo Finance’s Henry Blodget believes that investors are clearly becoming frustrated. “I think what really spooked people was the big loss that they forecasted this quarter. It was startling even to me,” says Blodget who has been a long time Amazon shareholder.
(Excerpt) Read more at finance.yahoo.com ...
There was a period of time when Bezos made a profit for a while just to show he could do it whenever he wanted to. Then he went back to building the business, which may or may not ever succeed but is sure doing a great job at building revenue and taking over industry after industry. I am very glad it exists, and I hope they find a way to make money while continuing to bring me the cheapest prices on everything I need, delivered to the door within 2 days most of the time.
Hey, they should become an airline..
Very good question.
Investment banks funded by the NY Fed manage IPOs and as a result they pick and choose who will be allowed to enter the billionaire’s club. Bezos got rich off of Wall St. approval of his IPO.
To be a member of the billionaires club, it is not necessary that you innovate very well. You should have a story of innovation that can be hyped but not something that any number of people could not duplicate. For example, Mark Zuckerberg did not earn his billions and he did not innovate something that was novel, that had never been done before, My Space preceded Facebook but the founder of My Space was not welcome to the club. Zucker berg received his billions from his IPO and the billions came from Wall St investment banks who were directed by NY Fed surrogates to subscribe to the IPO.
Bill Gates III of Microsoft was almost kicked out of the club in 2000 when Lawrence Tribe on orders of the Clintons and Larry Ellison tried to take him down and break up the company. Gates got the message and became a liberal. Before he was independent or more accurately indifferent. But he was really lucky that Clinton lost the election in 2000; I know I know Clinton was not on the ballot in name but his minion Al Gore was.
The billionaire’s club also supports Michael Bloomberg and his 150,000+ Bloomberg terminals that Wall St. traders use at $25,000+ per year fees which yields Bloomberg billions and billions of profits in his pocket each year. And those traders are not allowed any other choice. And all Bloomberg has to do to remain in good graces with his Fed masters is carry out the gun control initiatives that the NY banking cabal order him to make happen.
The puppet masters are at the NY Fed. If you are in good with them and you happen to be the person they need at the moment, then you too can be a billionaire.
Amazon isn’t being “taxed” any more than they used to. They just have to collect sales tax. Which they are passing on to their customers.
Why should he care about making a profit? People use his product, and people keep buying his stock. Things are going great for him. As long as suckers keep buying the stock, then why should he care?
IPO. Build a profitless business, sell off a portion of it for a large amount of money. Cha-ching!
My question exactly
A stockholder would care about profits, possibly — or they might not, if the stock value increases anyway.
A business doesn’t have to make any profits to be viable. You can operate a family business that makes no money, but pays your salary. You don’t need a profit.
At some point you would expect stockholders to balk, and then the stock price will drop and the stockholders will be upset.
But “profitless prosperity” is not a mythical thing. It just isn’t the “norm” for a publicly held corporation.
Another problem sometimes is not having the high quality merchandise. OverStock is good for a lot of things, sometimes much more focused on quality + value. To find Made in the USA and/or 100% natural fibers, Amazon doesn't do a good job listing things that way.
It's a shame. They do so many things that are great for consumers, but then on other things they seem to be not focused enough. JMHO
Obviously we do not need one of those to buy and sell stock, they should all dump it.
> How does one get so wealthy without making a profit?
That’s a rhetorical question if I ever heard one...: )
wouldn’t have anything to do with China’s copy, Alibaba? Probably hacked the whole company, too. (what a daffy name)
> Could it have anything to do with now being taxed in more and more states?
I think you can correlate the causes of large losses and business closures by corporations and small business to two dates:
November 4, 2008 and November 6, 2012
Both had everything to do with the current horrible economic situation we are in.
: )
I would really like to know. Seriously, any tip would be helpful. :p
Jeff Bezos is perhaps one of the most amazing and successful crooks in all of history.
______________
Would you explain that to me?
And go bankrupt and/or get sued by investors. Simple answers never work in a complex world.
No.
Just because the company doesn’t profit, doesn’t mean it doesn’t do well. I could create a company that makes $1Mil/year, and if I buy parts for $500K, and pay myself $500k, then the company doesn’t make profit. I do very well, and the company may grow, but the bottom line for the company is a net profit of 0$. Any company will try to maximize it’s deductions, as the more you can take off at the end of the year, the less taxes you’ll pay. Messed up, but that’s how it is.
>> But “profitless prosperity” is not a mythical thing.
Is it a SUSTAINABLE thing, though? That’s the question.
In Amazon’s case “profitless” is a misnomer. Not-for-profit organizations are ALL profitless.
But Amazon (and other entities like them, e.g. the US government) is they are not “zero profit”, but rather, “lossy”. Amazon is not “sometimes profitable”, or “not-for-profit”. The company LOSES money, year after year after year.
My FRiend, that is simply NOT sustainable in perpetuity.
And while short term “profitless prosperity” may not be a myth, perpetual “profitless prosperity” most definitely IS a myth.
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