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I think you're vastly underestimating how much money Amazon makes. So Amazon currently hires 120,000 people at $12/hr for 10 weeks for a total cost of somewher
by mikeyouse 9y ago
I think you're vastly underestimating how much money Amazon makes.
So Amazon currently hires 120,000 people at $12/hr for 10 weeks for a total cost of somewhere near $576M. This counts as COGS and is included in their gross margin. If we just multiply that figure by (52 / 10) and subtract out the $576M, we can see that it would decrease their annual Gross Margin by $2.5B. Add on an additional 30% of the combined $3B in salary expense since I doubt the temp workers get benefits, and you'd be looking at a total of ~$3.4 billion.
So in 2016, this would've changed their gross income from $47.7 (35% GM) billion to $44.3 billion (32.5% GM).
- Veelox 9y agoThat $3.4 billion puts their net income negative for the year negative.
- mikeyouse 9y agoRight, but net income is a fiction to begin with. It has almost nothing to do with a company's actual health. Last year was the first year that Amazon ever showed a NI over a few hundred million (for most of their life, it's been negative). https://a16z.com/2014/09/05/why-amazon-has-no-profits-and-why-it-works/ https://a16z.com/2014/09/05/why-amazon-has-no-profits-and-wh...