tonyt,
My numbers are from no publication, and, again there may be some extraordinary reason for larger than originally projected loss, but I would imagine such a reason would be non-recurring. There must be a reason for Bloomberg to double it's loss projection. What is it? The post you cited didn't state a reason.
Amazon's revenues should be $100 million +. If their margin is 20% (it was 22.1% first quarter), that's $20 million. Assume their SG&A doesn't decline as a % of sales from 1Q98 (and it has declined every quarter since 2Q97), SG&A would be $32.3 million, plus interest cost of $400K = a loss of $12.7 million or $ .26 per share.
Their sales are perhaps the most easily predicted, so in order to get to a loss of $ .43 or $21.3 million, assume margin at 18.7% (their worst ever), that's $18.7 million. SG&A plus interest would have to be $40 million, 42% higher than 1Q98. Their SG&A hasn't grown that much since 2Q97, and they're a much larger company now. Since then it's declined steadily, 33% in 3Q97, 39% in 4Q97, and 24% in 1Q98. It would also represent a jump in SG&A of $11.5 million over 1Q98 which is more than double the increase for the past 4 quarters in which SG&A has increased an average of $5.4 million per quarter.
Again, there could be some extraordinary charge associated with the music start-up, but I would bet that would be non-recurring, and the above revenue estimate is based on past trends without consideration of music revenues kicking in.
Tell me where I'm off the mark. |
