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Which if I recall correctly they are only profitable due to a one time revenue boost right of something like hundreds of millions ? And that one time "revenue"
by BoiledCabbage 3y ago
Which if I recall correctly they are only profitable due to a one time revenue boost right of something like hundreds of millions ?
And that one time "revenue" boost was that a company they own they are asserting is now valued more than last year. And they are calling that "revenue".
- lhorie 3y agoNo, it's operating profit.
- kiba 3y agoI took a look at a fool article. If you exclude the unrealized return from an investment they made, their profit are in the single digit millions. Not really confidence inspiring, but maybe I am wrong and that they could indeed make their business sustainable.
- Dylan16807 3y ago"could indeed make"? What's not sustainable about that level of profit? And aren't they still spending a lot on expansion?
- kiba 3y agoIt implies that their margin is really low. We're talking about revenues in hundred of millions and they're only able to make single digit millions. Next quarter, their margin might entirely be wiped out by a slight downturn in business. If they could increase their margin and make profit consistently, then I'll change my mind.
- Dylan16807 3y agoIs a particularly big percentage of their costs fixed? Because that affects the math a lot. If we consider a generic slightly-profitable company facing a 25% revenue drop, there's a huge gulf between a world where costs drop 10% and a world where costs drop 22%.