Hi Candle stick; Funny thing, BKS sells more than 50% more
in its 4Q than it does in the regular quarters. If you
adjust AMZN's figures accordingly, their 4Q sales are not
impressively larger than 3Q. This would indicate that their
growth in terms of increase in sales per quarter (absolute
value) has peaked. With most models of growth, this would
indicate that they have about half filled their niche.
Before I hear any comparisons with MSFT, please note that
MSFT's growth rate in terms of sales per quarter has
always been stellar, its the growth rate in terms of
per cent gain that is faltering.
But another fascinating thing to dredge out of the AMZN
filing today is what is happening to their gross margins.
They've been growing the business, getting efficiencies of
scale, supposedly, so their margins should be expanding,
right?
Here are the figures:
1997 % CHANGE 1996 % CHANGE 1995
------- -------- ------ -------- -------
(IN THOUSANDS)
Gross profit.............................. $28,813 733% $3,459 3,291% $ 102
Gross margin.............................. 19.5% 22.0% 20.0%
The Company's gross margin decreased due to a combination of lower
prices and lower overall shipping margins, partially offset by improvements in
product cost.
The worst part, is that simultaneously, BKS has pretty much
continuously increased their margins for years:
Period BKS AMZN Ratio
1Q96 .345 .206 1.675
2Q96 .351 .214 1.640
3Q96 .359 .218 1.647
4Q96 .372 .223 1.668
1Q97 .348 .203 1.714
2Q97 .355 .187 1.898
3Q97 .368 .189 1.947
4Q97 .383 .195 1.964
Pretty clear, BKS just keeps making more money, AMZN
just keeps letting more slip through their fingers.
-- Carl |
