Amazon.com, Inc. (AMZN) Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

AMZN 233.95

+0.3%

3:59 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Glenn D. Rudolph who wrote (23125)	10/27/1998 1:41:00 AM
From: SilverAG	Read Replies (2) of 164684

I see many similarities between AMZN & XCIT's restatement of earnings. XCIT made a $70 million deal with Netscape and tried to write the whole thing off at a loss. They almost got away with it but the SEC sniffed them out and forced XCIT to amortize the deal resulting in an unexpected .15/share earnings charge over a 2 year period. This news came to light on the day XCIT released this quarter's earnings. So what happened? People were puzzled when the numbers came out. On one hand, XCIT made a .02 profit, beating whisper numbers and breaking into the black for the first time. But on the other, on a GAAP basis, earnings were negative (.14). So which set of numbers was correct? Of course, the official GAAP numbers, the loss! How did investors react? Both bulls and bears thought they had won; the bulls crowed about their blow-out quarter while the bears snickered at the SEC crackdown. What happened to the stock? It went down after the announcement & the next day (this was when the DOW went ballistic over the rate cut). I believe that on Wednesday the same thing will happen when AMZN releases earnings. The SEC has forced them to amortize the Junglee acquisition over a 3 year period (it's nice of AMZN to restate 1997 figures already so they now only have two years to go). The adjustment will force them to show a non-cash charge of $15 million per quarter for the next 2 years!! That's shaving off a good .30 per quarter. So what's going to happen on Wednesday? I believe they will have to show two sets of numbers- diluted and non-diluted results. Which ones should investors pay attention to? Of course, the diluted numbers!! The company has to write off $15 million a quarter for the next 2 years!! They have already bought Junglee and the 2 million shares have already been issued, so you concentrate on the diluted earnings. The diluted EPS numbers are going to look BAD BAD BAD. 206.253.196.11 Already for the first six months of 1998, the diluted EPS loss is (1.35). With another (-.35) whisper number loss expected and another (.30) charge for the merger right-off AMZN will already be off (2.00) for the year on a diluted per share basis. Comments?

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next