Amazon's Profitable Q2: Is It Bigger Than Wal-Mart? - InformationWeek

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7/27/2015
10:20 AM
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Amazon's Profitable Q2: Is It Bigger Than Wal-Mart?

Amazon's second-quarter earnings showed a small but unexpected profit. Some say the company is now worth more than the world's biggest brick-and-mortar retailer.


(Image: Tuomas Kujansuu/iStockphoto)

(Image: Tuomas Kujansuu/iStockphoto)

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GAProgrammer
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GAProgrammer,
User Rank: Ninja
7/31/2015 | 3:40:12 PM
Market capitalization
Definition:  the total dollar market value of the shares outstanding of a publicly traded company; it is equal to the share price times the number of shares outstanding.

Aka - all it takes is a downward stock value for this to change for Amazon. Every company that is measured this way is one bad PR event (like the Prime Day debacle) away from devaluation. Don't read too much into these tech articles that "X is bigger than Y because of market cap." They make good headlines, but horrible investing advice. Retail dollars and profitability are where the rubber meets the road and where WalMart slaughters Amazon.

As for investors tolerating zero profitability - Bezos & Co already had to back away from statements about not caring about profitability, precisely because of investors. Be careful when reading articles like this that the author hasn't cherry-picked comments just to make a point.
Angelfuego
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50%
Angelfuego,
User Rank: Ninja
7/27/2015 | 8:37:31 PM
Re: Amazon
This doesn't surprise me. I assumed Amazon surpasssed Walmart a few years ago. I love Amazon and shop on their website regularly. I also think Amazon gift cards are a great gift!
Angelfuego
50%
50%
Angelfuego,
User Rank: Ninja
7/27/2015 | 8:37:31 PM
Re: Amazon
This doesn't surprise me. I assumed Amazon surpasssed Walmart a few years ago. I love Amazon and shop on their website regularly. I also think Amazon gift cards are a great gift!
CharlesB554
50%
50%
CharlesB554,
User Rank: Apprentice
7/27/2015 | 1:18:43 PM
Amazon
Malpuru-Kodali is saying Bezos wants to build a giant, dominant company of the future, not a highly profitable one. I think he's doing that. At some point, when a second generation of management comes in, they'll be able to figure out how to make it profitable, given the foundation that Bezos & Co. have built. "Amazon's earnings are about zero and will be into the foreseeable future," she says. Yes, and it sales keep growing and even its infrastructure, the AWS cloud, is proving to be profitable. I think Amazon wastes a lot of money trying to become a major player in tablets and cell phones. But that's the price of this expansionist outlook. And many investors have decided they want a piece of a dominant company of the future, profits or no profits.
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