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Plus Amazon is Amazon. They've essentially been saying to investors for years "sure, we could make more money for YOU, or give YOU dividends, but WE can do bett
by tribune 8y ago
Plus Amazon is Amazon. They've essentially been saying to investors for years "sure, we could make more money for YOU, or give YOU dividends, but WE can do better with your money than YOU could." It's worked, of course, enabling them to grow into the gargantuan enterprise they are today. A smaller company without that proven track record wouldn't get such a license from investors for long.
- ryanwaggoner 8y agoWasn't Amazon doing that in their early days, when they didn't have a track record?
- dalore 8y agoAnd didn't the share price reflect that at the time, which has now grown considerably now that the market has more confidence in them.
- TylerE 8y agoSort of? I mean unlike 99.9% of the first wave of DotCom startups they managed to avoid actually going bankrupt.
- scarface74 8y agoThey got lucky and secured a line of credit right before the bust.
- johnvanommen 8y agoThat was a dark time. I was living and working near Seattle, and there were basically seven big employers for techies: * Microsoft * Boeing * T-Mobile * WaMu * Amazon * Concur * Real Networks And three of the seven were in severe financial distress. It was like, "hmmm is it time to leave Seattle?"
- voxadam 8y ago"Will the last person leaving Seattle - Turn out the lights" https://static.seattletimes.com/wp-content/uploads/2017/04/cd1e2824-1fbf-11e7-8bc4-4c9cbbc3f2c9-780x479.jpg https://static.seattletimes.com/wp-content/uploads/2017/04/c...
- xkjkls 8y agoI'm sure they ran a lot of experiments in the earlier wild west days of e-commerce that wouldn't look so great today, but we've learned a lot about what a successful e-commerce business looks like since then.
- jonbarker 8y agoThis argument is funny to me mainly because I hear it all the time, about how different they are because they don't want to be profitable. The other thing management is supposed to do is manage cash flow and profit in such a way as to reduce risk (by piling up cash, not too much of course, but just enough...). They also survived the dot com crash because they were thrifty and always kind of cash flow break even.
- slackoverflower 8y agoAmazon simply does not need to have cash on hand. They can attain massive profits at literally any point by just increasing their margins ever so slightly across whatever business lines they operate in. This is the benefit of the scale they operate at.
- delecti 8y agoThey would have profits if they stopped reinvesting the proceeds from retail into new businesses. They wouldn't need to increase their margins or reduce costs, just stop willfully adding new costs.