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> Amazon isn't making any money yet. Amazon makes TONS of money. They aren't currently returning any of it to shareholders as profits, they're continuously re
by msandford 11y ago
> Amazon isn't making any money yet.
Amazon makes TONS of money. They aren't currently returning any of it to shareholders as profits, they're continuously reinvesting it in the company.
The difference between gross profit and net profit is how much Amazon is spending on building new businesses that after a few years start grossing $10b a year in sales like AWS. That got funded out of the gross profits from regular Amazon retail operations.
- kahwooi 11y agoLOL. Ballmer say so: http://www.geekwire.com/2014/ex-microsoft-ceo-steve-ballmer-says-amazon-com-isnt-real-business/ http://www.geekwire.com/2014/ex-microsoft-ceo-steve-ballmer-...
- rhizome 11y agoBallmer isn't conflicted or anything.
- beambot 11y agoNot to mention that MSFT went from $50/share to $30/share under Ballmer's tenure as CEO. Not sure he has any legs to stand on to bash AMZN about being a "real business." http://money.cnn.com/infographic/technology/gates-ballmer-microsoft-stock/ http://money.cnn.com/infographic/technology/gates-ballmer-mi...
- CamperBob2 11y agoAlso, the iPhone is never going to fly.
- ProAm 11y agoHow long should an investor wait to get any ROI on a 20 year old company? (honest question)
- deleted 11y ago[deleted]
- jfoutz 11y agoIf you want defined returns you can buy amazon bonds today. if you want to try to triple your money in 5 years, well, maybe that'll happen with the stock again. who knows?
- TheSpiceIsLife 11y ago1st July 2006 Amazon shares traded for $26, they're currently bouncing around $600. See here: http://finance.yahoo.com/echarts?s=AMZN+Interactive#{"range":"10y","allowChartStacking":true} http://finance.yahoo.com/echarts?s=AMZN+Interactive#{"range"...
- taneq 11y agoThis seems like a huge distinction that people don't make often enough with high-performing, fast-growing companies. You see it with Tesla, too, when people claim that the Model S is "sold at a loss", ignoring the fact that a large part of the company's current expenditure is in setting up huge new factories.
- lubos 11y agoBad example. New factory is an asset, not an expense. Therefore it will have little impact on profitability.
- deleted 11y ago[deleted]
- simonh 11y agoThe AWS data centres aren't an asset? I'd have thought comparing funding expanding Amazon's data centre capacity from revenue is very comparable to Tesla building out it's manufacturing capability the same way.
- discodave 11y agoThe DCs are assets with 5-20 year lifespans but the servers depreciate over 3-5 years. Amazon has also been doing a bunch of capital lease shenanigans so they could expand AWS without having to report GAAP losses over the last few years.
- fabulist 11y agoGenuinely curious, who sells, rebuilds, or otherwise "end of lifes" a datacenter after 5 years?
- bdkoepke 11y agoThe issue is Amazon stock is very expensive when compared with other companies. Walmart's market cap is ~250B, whereas Amazon is $350B. Amazon had $100B sales last year, Walmart had $500B. If Amazon can generate profit at the same rate as Walmart then Amazon needs to get to $700B in sales for that valuation to make sense... If Amazon double's in value again it would have to have sales representing 10% of US GDP at the same profitability level as Walmart. Smells like a speculative bubble to me.
- petra 11y agoAmazon is a much more global/scalable company than Walmart, both now and potentially, so the calculation should be a bit different.