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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 226.19

-1.8%

Dec 12 9:30 AM EST

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To: Killswitch who wrote (111149)	10/26/2000 5:00:19 PM
From: Glenn D. Rudolph	Read Replies (1) of 164684

Dude did you even listen to the conference call? They will have around 1 billion in revs this 4Q, not to mention 4Q2001. Brian, I do not believe "real revenues" will be that high this quarter. There really is no way to predict sales particularly being in new markets and with new lines. Sales growth has already slowed a lot. It is below 5% sequentially. Seqentially will surely be higher in Q4 compared to Q3 but the momentum of prior years off of a smallar base is gone. On-line sales are going at rapid clip but a good chink of the new business is going to dual channel pre-existing names. It is a little here and a little there. My expectations is this quarter will pretty much terminate the Amazon story as a pure play e-commerce firm. The stock price will likely run up unto the season regardless but that does not reflect the fundamentals. I looked at their balance in income sheets rather closely and compared them with Q2. My opinion is inventory was valued using a different method in Q3 so we saw a large appearance of increased gross margins. A retailer's margins and efficiencies do not do an about fact in one quarter during the slower summer moths. Efficiences come from much high revenue, etc. The difference between $585 million and $615 million is not nearly enough to add 600 basis points by itself. This also is too high a change even if shipping was less fragmented. My opinion is money will be needed by Amazon by early spring. They will not be totally out but will be very low and that is when they try and tap the equity markets. I anticipate Amazon will attempt to tap the equity markets prior to releasing Q4 numbers. We have a lot of projections here and guidance that is really suspect. The initial hint was the prepared statement of a $4 million cash burn. Amazon hardly talked about cash burn in prior conference calls unless pressed during Q&A. I believe they are attempting to change sentiment and the market is going along with it. Fundamentally, Q3 was the same as Q2 in my opinion Glenn

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