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> No profit = FAIL. At some point the funding they are getting, from investors and stock owners is going to dry up like the Serengeti when they realize they won
by jsolson 10y ago
> No profit = FAIL. At some point the funding they are getting, from investors and stock owners is going to dry up like the Serengeti when they realize they won't make money.
An explicit part of their business plan is maximizing free cash flow (not profits).
I'm not sure what funding you think the company is getting from investors. Amazon's stock price could drop through the floor and the biggest issue the company itself would face is the departure of a workforce who take a significant chunk of their compensation in AMZN shares. Unless they're hoping to do another public stock offering the share price is mostly useful as a gauge on Jeff Bezos's net worth.
When the company does want outside funding, it hasn't turned to public stock offerings in recent years. Instead they've secured it by issuing corporate bonds[0]. THERE is somewhere they might have to worry, but as long as their credit rating stays high, they'll find plenty of institutional buyers. Their credit rating is maintained by people who understand that profitability has little to do with how well a large business is doing, and is sometimes an indication of failure to manage funds well (failing to employ depreciation appropriately to minimize tax liability in very successful years, etc.).
[0]:https://www.bloomberg.com/news/articles/2014-12-02/amazon-sells-6-billion-in-biggest-bond-deal-for-online-retailer https://www.bloomberg.com/news/articles/2014-12-02/amazon-se...