4 ms·
I was always wondering about the profit margins of these companies. From their prices I always felt that I am paying a portion of the previous guy's vacations.
by HenryBemis 7y ago
I was always wondering about the profit margins of these companies. From their prices I always felt that I am paying a portion of the previous guy's vacations. I'd call it a pyramid scheme, only everybody loses.
- Scoundreller 7y agoTaking less money now for higher expenses in the future isn’t that unusual. It’s basically the cornerstone of insurance companies (especially life insurance).
- nly 7y agoThat industry isn't a scam though. Life insurance companies have at least some capacity to balance their books by selling annuities or lifetime mortgages. The number and magnitude of life insurance claims is dwarfed by the hundreds of thousands of pensioners every year that are converting their accumulated wealth to income at paltry rates.
- xioxox 7y agoThe big problem was its £1.4bn in debt, which really brought it down. Id be careful holding shares in companies with big debt if there's a coming downturn.
- dehrmann 7y agoHow's AT&T looking these days?
- Mindwipe 7y agoNetflix and WeWork are more pertinent examples tbh.
- mrguyorama 7y agoI was not aware Netflix had significant debt.
- Mindwipe 7y agoNetflix is basically sticking $4 billion a year in bonds at this point. That's not necessarily a problem today. Debt is cheap. But they do have to slow that down at some point through lower spending or increased revenue, and if the cost of debt suddenly skyrocketed in the meantime, which is not impossible, that would be a big problem for them.
- chillydawg 7y agoNicely propped up by the government.
- jl6 7y agoI have a future holiday booked with Thomas Cook. I paid a deposit, which I expect to get back through either ATOL or my credit card company. The overall cost was going to be less than I would have paid booking direct. They should probably have charged me more :(
- dehrmann 7y agoProbably should check with the credit card company sooner rather than later.
- dehrmann 7y agoMaybe this is nitpicking, but it might be more that they're always one month behind on all their bills. A pyramid scheme needs to keep getting suckers on the bottom layer; this might operate fine with repeat customers.
- dmitriid 7y ago> profit margins of these companies They are really low. They rely on large numbers of tourists to have a meaningful profit YoY. Source: worked for a tourism company in early-to-mid 2000s.